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Vertex (VRTX) PT Raised to $161 at Piper Jaffray Following ORKAMBI Approval

July 6, 2015 7:10 AM EDT
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Price: $418.01 +0.17%

Rating Summary:
    29 Buy, 11 Hold, 1 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 13 | Down: 11 | New: 11
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Piper Jaffray analyst Edward Tenthoff reiterated an Overweight rating and boosted its price target on Vertex (NASDAQ: VRTX) to $161.00 (from $146.00) following FDA approval of ORKAMBI. The approval will drive top-line results and profits, according to the analyst.

Tenthoff commented, "CONCLUSION Last Thursday, 7/2, the FDA approved ORKAMBI in homozygous F508del cystic fibrosis patients aged 12 and older. Vertex announced annual ORKAMBI pricing of $259,000, which was below our expectation of "in-line with KALYDECO," but still above Street consensus. Applying a gross-to-net discount of 20%, we are lowering our total CF sales forecast to $883 million from $1.0 billion this year, to $2.4 billion from $3.1 billion in 2016 and introducing a 2017 forecast of $3.2 billion. This ramp in sales will result in sustained profitability with non-GAAP EPS now at $3.15 in 2016 and $5.69 in 2017. We reiterate our Overweight rating and are increasing our price target to $161 from $146 by applying the same 35x multiple now to 2017 Non-GAAP EPS discounted back at 15% through mid'16."

The firm trimmed FY 2015 EPS from ($2.20) to ($2.73) and FY 2016 EPS from $3.54 to $1.53.

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 $131.26 yesterday.



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Piper Jaffray, Edward Tenthoff