UPDATE: J.P. Morgan Initiates Coverage on NPS Pharmaceuticals with Overweight Rating, $40 PT on Emerging Market Leader Status

In a report published Friday, J.P. Morgan analyst Geoff Meacham initiated coverage on NPS Pharmaceuticals NPSP with an Overweight rating and $40.00 price target. In the report, J.P. Morgan noted, “We are initiating coverage of NPS Pharmaceuticals (NPSP) with an Overweight rating and a Dec 2014 price target of $40. NPS is a rare disease–focused biotech company that is evolving into a global commercial-stage entity with two wholly owned assets, Gattex for short-bowel syndrome (SBS) and Natpara for hypoparathyroidism. For Gattex, we are encouraged by the launch in the US thus far and the leverage that should come from owning global commercial rights when the EU launch (brand name Revestive) initiates in 1Q14. For Natpara, NPS is targeting a BLA submission by YE13, which sets up a commercial launch in late 2014 / early 2015. In our view, the opportunity for Natpara is very underappreciated by the Street; our research indicates a peak WW opportunity of $1.2B based on the significant unmet medical need. Despite the strong YTD performance (+219% versus the NBI index at +54%), we still view NPSP shares as attractive given upside from the US Gattex launch and EU approval as well as regulatory progression of Natpara in 2014.” NPS Pharmaceuticals closed on Thursday at $29.01.