Bank of America Reiterates on Intercept Pharmaceuticals
In a report published Friday, Bank of America Merrill Lynch analyst Rachel McMinn reiterated Buy on Intercept Pharmaceuticals (NASDAQ: ICPT), raising its price objective to $872.00 from $81.00
According to the report, the price objective rise is driven by the analyst's revised model which now includes a heavily positive probability adjusted potential for ICPT's development stage drug obeticholic acid (OCA) for the treatment of nonalcoholic steatohepatitis (NASH).
“Based on the staggering est prevalence of 6 million US advanced NASH patients (similar exUS), and trajectory for NASH leading to epidemic cirrhosis and liver transplant rates, this market has a potential to be as big or bigger than Hepatitis C,” the report noted. “As a base case in our model, we are assigning a $4B peak sales estimate on OCA on what we view as extraordinary study results. While the stock quadrupled yesterday, we see additional significant upside as investors size the market opportunity for NASH.” Some highlights from the report included:
-”The Phase 3 FLINT study of OCA in NASH was stopped early based on a statistically significant outcome from an interim analysis.” -”CPT is making steady progress in securing a confirmatory trial design for OCA in its lead indication, primary billiary cirrhosis (PBC), having submitted a placebo control trial design to the agency after thorough analysis of large PBC datasets. ICPT closed Thursday at $470.00 with shares trading up at 69 percent.
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