UPDATE: Bank Of America Downgrades Seattle Genetics, Inc. On Frontline Expectations

In a report published Tuesday, Bank of America analyst Steve Byrne downgraded the rating on

from Neutral to Underperform, and lowered the price target from $40.00 to $34.00. In the report, Bank of America noted, “Following PTCL data from ESMO and post-transplant Hodgkin Lymphoma (HL) AETHERA data, we are lowering our rating to Underperform (from Neutral) and our DCF-derived PO to $34 (from $40). While consolidation in post-autologous stem cell transplantation (ASCT) HL with Adcetris had a 75% progression free survival (PFS) advantage vs. placebo, the interim overall survival (OS) advantage was not significant. While this could reflect limited statistical power with few events, it appears to be partly due to use of Adcetris post-progression in the placebo arm. We raised the probability of approval in this setting to 70% (from 60%), but we slowed the ramp pending OS data in 2016. In our view, the lack of survival advantage could reinforce Adcetris' role as salvage therapy and less as a frontline option. Our model revisions were primarily in the frontline settings (see below).” Seattle Genetics, Inc. closed on Monday at $38.39.