UPDATE: J.P. Morgan Downgrades Prosensa Following Drisapersen DEMAND-III Study Failure

In a report published Tuesday, J.P. Morgan analyst James D. Gordon downgraded the rating on

from Overweight to Neutral, and lowered the price target from $35.00 to $6.50. In the report, J.P. Morgan noted, “Following failure of the Drisapersen DEMAND-III study for DMD, our mid-2014 EmV is lowered to $6.50 ($35.00). With 6% downside potential, we downgrade to Neutral ([from] OW). Post PIII failure, we see a high chance current data is insufficient for approval. If Drisapersen isn't approvable on existing data,partner GSK may decline to fund further development, creating a funding challenge with Prosensa's finite cash-pile ($117m). DEMAND-III pres. Oct 5th could provide more colour on efficacy in sub-groups, but we see lingering uncertainty, pending an FDA verdict.” Prosensa Holding NV closed on Monday at $6.91.