Top M&A Target: Madrigal Pharmaceuticals Could Be Next After Successful NASH Data, Analyst Says

  • Madrigal Pharmaceuticals Inc MDGL has announced positive topline results from the pivotal Phase 3 MAESTRO-NASH biopsy trial of resmetirom.
  • JMP has raised the price target from $182 to $312 and reiterates its Market Outperform rating.
  • Resmetirom looks approvable based on Phase 3 MAESTRO-NASH data, the analyst said.
  • The analyst raised POS for resmetirom to 90% in both the U.S. and EU (from 70% and 60%, respectively) with peak sales of ~$5 billion and ~$1.5 billion (compared to $3 billion and ~$600 million expected earlier).
  • JMP models at an annual price of $15K in the U.S. (up from $5K) to be more in line with the annual WAC for obesity drug Wegovy ($16,188) from Novo Nordisk A/S NVO.
  • The analyst also raised the European price estimate to $5K (from $3,500).
  • JMP writes that Madrigal has now become a top M&A target. There is no shortage of large players with NASH exposure, including Novo Nordisk, Novartis AG NVSPfizer Inc PFEEli Lilly And Co LLYMerck & Co Inc MRKAstraZeneca Plc AZNGilead Sciences Inc GILD to name a few, that could drive up a takeout premium.
  • Price Action: MDGL shares are up 6.71% at $250.35 on the last check Tuesday.
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