H.C. Wainwright Destroys Epizyme Price Target, Sees 'No Material Value Drivers'

In a report published Monday, H.C. Wainwright analyst Andrew S. Fein downgraded the rating on

to Neutral, while reducing the price target from $45 to $22, citing the absence of any material value drivers in the near- to mid-term. Analyst Andrew Fein mentioned that although Epizyme's EZH2 inhibitor remained an active antitumor agent, there was no clarity around its optimal indications and its ability to pose competition to existing agents. The developmental and commercial prospects of this agent remained uncertain. The company was unlikely to provide any positive news flow in the near to medium term, Fein said, while adding, "We do not expect to gain much clarity during the next year either." Epizyme is expected to provide information in the near future on the opening of a new IND, announcement of an EU partner, solid tumor data at ECC, EZH2 update at ASH and Dot1L update at ASH, none of which would be big value drivers, the H.C. Wainwright report stated. "Overall, we struggle to see any real value drivers over the next 9-12 months, and expect Epizyme shares to stay caught in choppy waters possibly until data from the DLBCL/FL Phase 2 cohorts next year," Fein wrote. Fein explained that the price target reduction was attributable to varied reasons including increased preclinical and clinical development costs, revised potential market for the EZH2 inhibitor and reduced overall probability of success from 60 percent to 33 percent and advance of two potential competitors to the same clinical stage.