H.C. Wainwright Double Upgrades Intercept Pharmaceuticals (ICPT) to Buy

H.C. Wainwright analyst Ed Arce upgraded Intercept Pharmaceuticals (NASDAQ: ICPT) from Sell to Buy with a price target of $19.00.

The analyst comments "

Surprisingly strong interim results from Oca+Beza combo look to breathe new, longer life to the franchise. Three major value-inflection points have occurred since May 22: (1) On June 22, OCA in NASH received a second CRL, prompting the company to discontinue the NASH program entirely. This also involves a restructuring including laying off about one-third of its employees, but positions the company to be profitable next year based on its PBC business with Ocaliva. Given the CRL, this was widely expected. However, (2) on June 23, the company announced interim Phase 2 dose-ranging data from its Ocaliva + bezafibrate combination, the first such data in PBC patients. The data was unexpectedly strong, with ALP normalization in the high-dose arm (n=15) of 75% after 12 weeks of treatment, and biochemical remission (a new more comprehensive composite measure of 5 biomarkers) of 58%. Critically, the high-dose arm had the lowest pruritus (2 events, 13%). We were skeptical of any meaningful incremental benefit from the combo, so these results (albeit small sample size) are a positive surprise to us. (3) On June 30, GENFIT (GNFT; Buy) and partner Ipsen SA (EPA: IPN; not rated) announced positive data in PBC from the Phase 3 ELATIVE trial of elafibranor. See our note here: Positive ELATIVE Phase 3 Dataset Supports Elafibranor's Potential U.S. Approval For PBC in 2H24; Increasing PT to $11. While the drug's risk-benefit profile leaves little doubt of its approvability, in our view, elafibranor did not show a reduction in pruritus, as is widely expected of seladelpar when CymaBay (CBAY; Buy) reports top-line results from the Phase 3 RESPONSE study expected this quarter. As such, we believe both seladelpar and GSK's (GSK; not rated) linerixibat, if approved, would be preferred agents over elafibranor. This may also be true of Oca+Beza if more conclusive evidence establishes its ability to reduce pruritus. Overall, we now expect Intercept may continue to grow and significantly expand the PBC market along with CymaBay and GSK, and to a lesser extent, Ipsen/GENFIT. For Intercept, we now expect this life-cycle management combo therapy has the potential to substantially extend the PBC business and garner a significant share of the market. See Exhibit 1 for a side-by-side data comparison of Oca+Beza versus seladelpar 10 mg (the leading 2L candidate, in our view). As a result, we upgrade ICPT shares to Buy from Sell previously, with a $19 price target ($8)."

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

Shares of Intercept Pharmaceuticals closed at $11.15 yesterday.

You May Also Be Interested In

• SpaceX (SPCX) Added to Morgan Stanley Space 60 List, Qorvo (QRVO) Removed
• Qualys (QLYS) PT Raised to $145 at TD Cowen
• JD.com, Inc (JD) PT Lowered to $37 at Macquarie ahead of earnings