Barclays Thinks PTC Therapeutics Has 234% Upside

• PTC Therapeutics, Inc. PTCT shares have plunged 40 percent year-to-date, and are trading close to the lower end of their 52-week range of $24.63 - $78.72.
• Barclays’ Geoffrey Meacham maintained an Overweight rating on the company, with a price target of $100.
• Meacham believes that Translarna would get approval, lending upside to the company’s shares.

PTC Therapeutics announced results from the Phase III ACT study of Translarna, or ataluren, in Duchene Muscular Dystrophy [DMD] patients with nonsense mutations.

Analyst Geoffrey Meacham said that although the trail did not achieve statistical significance on the 6MWT across the ITT, it demonstrated a highly significant benefit across a pre-specified subgroup, and also when pooled with prior Phase IIb data.

“Overall, while clearly not a home run, we view the data as supportive of FDA approval for Translarna in DMD given the major unmet need and the apparently favorable environment at FDA for DMD drugs; indeed, these randomized, controlled data look more compelling than those for BioMartin and Sarepta, in our view,” Meacham wrote.

He added, however, that the latest DMD data was “mixed enough” such that broader read-through is unlikely to other Translarna indications, like cystic fibrosis.

Based on the data, the company intends to submit the results to the EMA and the FDA as part of its rolling submissions by yearend 2015. “Overall, we are encouraged by the data and would be buyers of PTC shares,” Meacham added.