- HC Wainwright initiated coverage on Horizon Therapeutics plc HZNP with a Neutral rating and a price target of $74.
- The analyst writes that Horizon deserves credit for executing management's vision of building a rare disease powerhouse.
- Moreover, it's been a remarkable transformation for the company as it has emerged from the shadow of its controversial legacy primary care business to establish a leading orphan drug business led by Tepezza for thyroid eye disease (TED) and Krystexxa for gout.
- Though Tepezza's success allowed the company to shift from specialty pharma to biotech, the product has shown signs of a slowdown this year, putting pressure on Horizon shares.
- Furthermore, Tepezza could face competition in the coming years that would put additional pressure on the franchise.
- HC Wainwright sees Tepezza peak sales at $2.2 billion, well below the company's expectations of $3.5 billion.
- Last year's $3 billion acquisition of Viela Bio added three new products—Uplizna, daxdilimab, and dazodalibep. However, the analyst lacks conviction that these products will be more than modest growth drivers.
- Without more conviction that Tepezza's growth can resume its initial trajectory, HC Wainwright does not see a meaningful upside in shares at current levels.
- Price Action: HZNP shares are up 0.82% at $62.83 on the last check Tuesday.
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