Gilead Sciences (GILD) Has an 80% Chance of Trading Higher on this Catalyst - Morgan Stanley

Morgan Stanley analyst Matthew Harrison reiterated an Equalweight rating and $69.00 price target on Gilead Sciences (NASDAQ: GILD) seeing an 80% chance that shares move higher when Trodelvy HR+/HER2- mBC data is reported in March. TROPiCS-02 is an ongoing Phase III, open-label, randomized, multicenter study of sacituzumab govitecan (Trodelvy) versus physician’s choice (TPC) in patients with HR+/HER2- metastatic breast cancer (MBC) who have received at least two but not more than four prior lines of chemotherapy (NCT03901339). Tropics-02 was initially planed to enroll 400 patients, but ended up of enrolling 543 patients.

The analyst is handicapping the outcomes as:

Scenario 1 has a 20% probability of: mPFS separation > 2.5 months (p < 0.05) and/or mOS separation > 6 months (p < 0.05). If this occurs the expectations would be for shares to break $70.

Scenario 2 has a 60% probability of: mPFS separation ~ 1 - 2 months (p < 0.05) and mOS separation ~ 3- 6 months (p > 0.05). This event would not be as exciting but is expected to move shares higher and be viewed positively.

Scenario 3 is a complete failure and would likely cause multiple contraction but low expectations should limit the downside.

The analyst stated "Given all the assumptions, we believe the mOS difference (SG – TPC) was most likely to be ~ 3.5 – 5.5 months and associated power ranges from ~ 50% to 80% (further assuming ~ 25% censor rate). Given the wide power interval, we are cautiously optimistic about the likelihood of achieving statistical significance on this interim analysis. Furthermore, based on our analysis, we believe the most likely mOS separation between arms is ~3-6 months (~ 46% likely) and the likelihood of observing a separation > 6 months is ~ 26%. Finally, to meet significance, the minimum observed separation is estimated to be ~ 2.8 - 4.7 months."

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

Shares of Gilead Sciences closed at $61.35 yesterday.

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