UPDATE: BMO Capital Markets Downgrades Rigel Pharmaceuticals to Market Perform, Lowers PT on Mixed OSKIRA-1 Results

In a report published Friday, BMO Capital Markets analyst Jim Birchenough downgraded the rating on Rigel Pharmaceuticals

from Outperform to Market Perform, and lowered the price target from $17.00 to $8.00. In the report, Birchenough noted, “Rigel Pharmaceuticals (RIGL) and partner AstraZeneca (AZN) reported topline phase 3 OSKIRA-1 data this morning for oral SYK inhibitor fostamatinib (FOS-D) in patients with moderate-severe rheumatoid arthritis (RA) with inadequate response to methotrexate (MTX-IR). Results of the 923 patient study suggest a statistically significant improvement in the first co-primary endpoint of ACR20 response at 49% and 44% for FOS-D BID and BID/QD respectively vs. 34% for placebo (p<0.001, p=0.006). FOS-D did not meet the second co-primary endpoint of joint protection by modified total sharp score (mTSS) with insignificant improvement at either dose (p=0.252, p=0.170). We understand that placebo rate of non-progression in mTSS was high and made it difficult to demonstrate any benefit with FOS-D. Safety and tolerability were described as consistent with prior phase 2 experience. AZN is now awaiting OSKIRA-2 and -3 data later in 2Q13 before making any further decision on a regulatory filing.” Rigel Pharmaceuticals closed on Thursday at $7.52.