Bristol-Myers Squibb Co. (BMY) Deucravacitinib Miss a Surprise - Morgan Stanley

Morgan Stanley analyst Matthew Harrison reiterated an Equalweight rating and $71.00 price target on Bristol-Myers Squibb Co. (NYSE: BMY) after the company announced that its TYK2 deucravacitinib failed to meet both primary and secondary efficacy endpoints in Phase 2 LATTICE-UC for moderate-to-severe ulcerative colitis (UC). The press release indicated the safety profile was consistent with prior studies in psoriasis and psoriatic arthritis.

The analyst stated "We view the update as surprising given the broader JAK family has demonstrated positive results in UC - Pfizer's Xeljanz is approved in UC and AbbVie recently submitted its Rinvooq for regulatory review. Bristol stated that it is evaluating the trial and is also testing a higher dose deucravacitinib in a second Phase 2 UC trial (IM011-127) to potentially continue the UC program. The trial has a primary completion date in June 2022. Bristol has not disclosed dosing levels for the failed trial or the second trial. Bristol is also evaluating deucravacitinib in a Phase 3 psoriatic arthritis and has Phase 2 trials in Crohn's disease, systemic lupus erythematosus, and lupus nephritis. Outside of psoriasis and psoriatic arthritis, Bristol stated that it continues to expect >$4B in non-risk adjusted sales for deucravacitinib in 2029. We now have lower expectations for the remaining clinical program, but note dose can be an important driver so the higher dose program could yield different results. Importantly, the key focus for investors continue to be the label uncertainty which won't be clear until the PDUFA in 2022."

For an analyst ratings summary and ratings history on Bristol-Myers Squibb Co. click here. For more ratings news on Bristol-Myers Squibb Co. click here.

Shares of Bristol-Myers Squibb Co. closed at $59.01 yesterday.

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