Deciphera Pharmaceuticals Sees Renewed Competitive Edge After Theseus Pan-KIT Discontinuation: Analyst

Stifel upgraded Deciphera Pharmaceuticals Inc DCPH to Buy from Hold, with a price target of $20 from $14, after reevaluating the competitive landscape for the 2L GIST market.

Despite a significant ~40% drop from its 2023 peak, the continuous expansion of Qinlock's core business, the prospective commercial roll-out of vimseltinib, and potential long-term gains from Qinlock label enhancements are encouraging signs. 

Earlier, the analyst Bradley Canino said Qinlock's phase 3 for 2L exon 11+17/18 GIST was likely outperforming by Theseus Pharmaceuticals Inc THRX pan-KIT method. 

However, with the latter's termination, DCPH's strategy seems poised to rival sunitinib-based options. 

The analyst anticipates that vimseltinib will likely match the cross-trial efficacy of Daichii's Turalio, a CSF1R inhibitor currently on the market.

Moreover, vimseltinib might have a more favorable safety record, potentially allowing it to sidestep the class-wide Black Box Warning and REMS program, the analyst writes.

While Turalio records sales of around $30 million annually without significant growth, Stifel analyst reckons that a more advantageous label could spur some market growth. 

Yet, the projections for peak US sales stand at $75 million, a figure considerably lower than DCPH's $500 million US TAM estimate derived from healthcare claims data.

Price Action: DCPH shares are up 10.9% at $15.24 on the last check Thursday.