Acceleron's Luspatercept Is All About Duration, And This Analyst Is Excited About Its Prospects

Acceleron Pharma Inc (NASDAQ: XLRN) presented the longer-term Phase 2 data for luspatercept in MDS and beta-thal at the EHA meeting in Copenhagen.

Barclays' Carter Gould maintained an Overweight rating on the company, while raising the price target to $42.

“Data across both indications showed higher response rates with additional follow-up relative to the last update late in 2015. Improved breadth of response was a positive surprise,” Gould mentioned.

Apart from efficacy, luspatercept also demonstrated continued excellent tolerability, which sets the drug up for multi-year treatment duration.

Gould raised the duration estimate by 20 percent to 22 months, which might still prove conservative.

The peak sales estimate has been raised from $1.9 billion to $2.1 billion, which still assumes luspatercept use in only 50-55 percent of the diagnosed RS (+) segment at peak.

“The consistent takeaway from our conversations with hematologists at EHA was that there was "no compelling rationale" for why the drug's effect on hemoglobin should begin to wane now after 15+ months on therapy,” Gould mentioned.