Alexion (ALXN) Price Target Raised to $205 at Deutsche Bank on HPP Market Opp

February 10, 2014 10:34 AM EST Send to a Friend
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Price: $193.94 +1.53%

Rating Summary:
    13 Buy, 7 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 16 | Down: 28 | New: 35
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Deutsche Bank maintained a Buy rating on Alexion Pharmaceuticals (NASDAQ: ALXN) and raised its price target to $205.00 (from $125.00). Analyst Robyn Karnauskas thinks the market for Asfotase Alfa for severe Hypophosphatasia is larger than Street expectations.

"The next new product launch for Alexion is Asfotase Alfa for severe Hypophosphatasia (HPP). Our deep dive into the drug suggests the market is bigger vs. street expectations. We also updated our Soliris & expense assumptions to more accurately reflect company guidance," said Karnauskas.

"We believe incidence is greater than literature suggests & model 1/25,000 in US & 1/50,000 ex-US of severe pediatric HPP. There are two epidemiology sources: (1)1/100,000 from a Canadian study in 1957 & (2) ~1/300,000 from a French study in 2006. These studies (1) did not account for babies who died before diagnosis (50% of infants die), (2) only accounted for babies <6 mo of age who were diagnosed, (3) & assumed all HPP cases were diagnosed. We calculate an incidence of 1/25,000 in US & 1/50,000 in EU & 3000 pts with severe HPP WW in '14 growing to 5000 by '20, continued the analyst.

"We see a ~$1.6B unadjusted Opp'y for Asfotase Alfa in HPP. We model adjusted sales at ~$1.2B as we assign 50% prob. in severe adult-onset population due to uncertainty We model 50%, 40%, and 10% of HPP is infantile, pediatric, & adult onset. Given patient mix, we could be conservative in our assumption that the blended avg price per patient over time is ~$200K as this is below Myozyme ($600K) pricing. We also model 15% uptake in eligible adult-onset HPP patients & probability adjust this market further by 50%. We also assume a 30% infant mortality rate. We don't hit peak sales until 10 yrs post launch," she added.

For an analyst ratings summary and ratings history on Alexion Pharmaceuticals click here. For more ratings news on Alexion Pharmaceuticals click here.

Shares of Alexion Pharmaceuticals closed at $163.63 yesterday.


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