Rodman & Renshaw Reiterates Buy Rating on Valeant (VRX)

Rodman & Renshaw reiterated a Buy rating on Valeant Pharmaceuticals (NYSE: VRX) with a price target of $90. Comments following an FDA panel vote in favor of brodalumab approval.

"On July 19, 2016, an FDA advisory committee gave brodalumab, an investigational anti interleukin-17 (anti-IL-17) monoclonal antibody for moderate-to-severe plaque psoriasis, a unanimous 18-0 vote in favor of approval. The panel also recommended, as we anticipated, a safety monitoring regimen and label warnings for the drug. The brodalumab BLA carries a PDUFA action date of November 16, 2016," noted analyst Raghuram Selvaraju.

The analyst continued, "In our view, the vote in favor of brodalumab constitutes a meaningful positive value driver for Valeant, since it substantially increases the likelihood of brodalumab approval later this year. Investors should note that our projections do not include any contribution from U.S. sales of brodalumab, and thus the drug's approval could drive upside to our projections. Late yesterday, Valeant also announced that the FDA had approved its supplemental New Drug Application (sNDA) for the oral form of Relistor (methylnaltrexone bromide) to treat opioid-induced constipation (OIC). The drug, originally developed by Progenics Pharmaceuticals (PGNX; not rated) and acquired through Valeant's purchase of Progenics' partner, Salix Pharmaceuticals, in 2014, was previously only available in an injectable form. From our perspective, an oral formulation could allow the product to attain blockbuster (>$1B) status in annual sales."

Selvaraju added, "In the wake of these two positive regulatory outcomes, and in anticipation of the potential approval of Vesneo (latanoprostene bunod) for glaucoma later this week, we reiterate our Buy rating and $90 price target on VRX shares."

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

Shares of Valeant Pharmaceuticals closed at $23.54 yesterday.

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