UBS Sees Upside to Vertex Pharma (VRTX) Orkambi Pricing

UBS analyst Matthew Roden reiterated a Buy rating and $145 price target on Vertex Pharma (NASDAQ: VRTX) Wednesday, ahead of the July 5th PDUFA for Orkambi. The firm believes pricing of the cystic fibrosis drug could drive upward revisions.

Roden expects the FDA to take action on Orkambi this week, and they expect pricing disclosure could potentially impact Street VRTX models.

The firm sees upside to their 'Street-Low' Orkambi US/OUS pricing assumption of $150k/$125k, noting in part that Kalydeco is currently list-priced at $312k, "... we believe that Orkambi will be priced higher than our assumption - potentially even at parity to Kalydeco. Hence we continue to see favorable risk-reward into approval and pricing," the analyst said.

Consensus sell-side pricing is $218k/yr and they believe buy side expectations are slightly higher ($225-250k). "Hence we see near term NPV upside to $163 if Orkambi is priced at Kalydeco parity, based on homozygous only, suggesting another leg of upside if heterozygotes are included via VX-661 or the triple combos. We see worst-case downside to $106 in the unlikely event that Orkambi is priced at $150k."

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

Shares of Vertex closed at $123.48 yesterday.

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