What You May Be Missing About PTC Therapeutics In Germany
Oppenheimer’s Christopher Marai maintained an Outperform rating for PTC Therapeutics, Inc. (NASDAQ: PTCT) after the company announced that the German Federal Association of the Statutory Health Insurances [GKV-SV] had given an “unacceptable” decision in the arbitration related to Translarna pricing.
Analyst Christopher Marai said that authorities seem to have suggested a price reduction of as much as 65 percent, although this has not been confirmed as yet. PTC Therapeutics is considering withdrawing the drug from the German market, following which Germany would to have access Translarna through an importation pathway.
“We currently estimate, based on our $300K USD price estimate, that EU sales in nmDMD are worth $23/share. The German market represents $8-10/share. This change may delay revenues from Germany during the remainder of 2016 while PTC's commercial team communicates importation pathway to prescribing physicians,” Marai wrote.
He added, however, that once established, patients would likely come back on drug quickly, in view of unmet need and a lack of nmDMD-specific drugs in clinical development. “We do not view this as material to EMA approval, as the EMA is an independent agency to the GKV-SV,” the analyst commented.
In another research report, Oppenheimer mentioned that the pricing decision was not contestable, since it was a result of an arbitration process. It is important to note, however, that PTC Therapeutics has not accepted the new price, an action which prevents its use as a reference price in the EU.
“Pulling the product off the German market may be PTC’s best decision for pricing protection. More than 20 countries directly or indirectly reference German prices for price determination and going forward pricing discussions may be difficult. We anticipate the EU opp will be valued at a discount until higher pricing precedents are established in other jurisdictions,” the report elaborated.
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|Aug 2016||JP Morgan||Maintains||Neutral|
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