Deutsche Bank Starts PTC Therapeutics (PTCT) at Buy

Deutsche Bank initiated coverage on PTC Therapeutics (NASDAQ: PTCT) with a Buy rating and a price target of $75.00.

Analyst Alethia Young said, "PTC's lead asset ataluren is being studied in two Ph3 studies currently for DMD & CF nonsense mutations. Prior studies did not achieve primary endpt, but trends w/in each trial suggest efficacy. We explain why we think DMD & CF Ph3 trials may work from our detailed analysis. We have built a detailed qtly EU country model for ataluren too. Our findings on valuation suggest big upside will be unlocked if these Ph3 trials work."

"The DMD space has evolved significantly since ‘08. PTC’s Ph2b p-value was v close to significance AND the 6 min walk chg at 31m is clinically meaningful. If the 2b trial was same size as Ph3 currently or only one dose studied, it would have been significant then. We think under-powering is the main reason for not hitting. We are further encouraged that ataluren showed activity across all DMD states and effect on secondary endpoints All these points give us confidence in upcoming Ph3 which incorporates lessons learned," added the analyst. Ph3 data in DMD will readout in the 2H15. "Our valuation for DMD only is $49/share. If successful in DMD, we think investors may assign credit to ataluren for CF (also in Ph3). Every 10% success for CF is worth $4-5/sh. The CF study also would provide downside protection, our valuation for CF ONLY is $48/sh. Ph3 data in CF is about one year behind DMD data."

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

Shares of PTC Therapeutics closed at $32.72 yesterday.

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