AC Immune (ACIU) Could Be Under Pressure Following Eli Lilly Sola Failure - Leerink

November 23, 2016 8:15 AM EST
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Price: $12.40 -1.59%

Rating Summary:
    3 Buy, 0 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 24 | Down: 17 | New: 14
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Leerink Partners analyst Paul Matteis sees AC Immune SA (NASDAQ: ACIU) under pressure today after Eli Lilly announced that announced that its EXPEDITION3 study of solanezumab in Alzheimer's did not meet its primary endpoint; the study showed (likely a very small) trend on cognition (p=.095).

Matteis commented, "We expect ACIU shares to be under pressure today given the perceived read-through from the solanezumab (sola) result; however, we see specific differences between sola and crenezumab, and perceive the latter as much more similar to BIIB's aducanumab. While we will look to our model and assumptions once the full sola data are presented at CTAD on December 8th, our current 40% probability-of-success for crenezumab already balances optimism surrounding product profile/ph3 design while considering meaningful outstanding risk. And at a fully diluted market cap of ~$800MM (as of yesterday's close), we believe the stock implicitly assumes both a lower probability than this for crenezumab and little credit for ACIU's pipeline, which includes 4 partnered and 1 wholly owned clinical-stage asset."

The firm maintained an Outperform rating on ACIU.

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