Wedbush analyst, Heather Behanna, expects a potential catalyst for Prothena Corp (NASDAQ: PRTA) in 2H18 when data from the VITAL enrollment is released. A slip in the launch date pressures the price target to $77 but the analyst keeps the Outperform rating.

NEOD001 VITAL enrollment update sets up for pivotal trial readout in 2H18. At this time, Prothena anticipates enrollment to be complete in 2Q17 with data to follow in 12-18 months. As a reminder, VITAL is an event driven study enrolling newly diagnosed AL amyloidosis patients with cardiac involvement; the study is powered at 90% to see a 30% difference between study arms. Patients are randomized 1:1 and receive standard of care and either placebo or NEOD001.

The analyst pushed launch in the US to 3Q16 from 1Q16, lowering the price target but there is upside to estimates if the PRONTO study, set to read out in late 2017/early 2018, can be used for accelerated approval in the US. Today it is assumed this study can be used for conditional approval in the EU.

Prothena reported EPS of ($0.76) for the 4th quarter and ($2.66) for the year; lower than our estimates and consensus due to lower spend. Prothena ended the 4th quarter with $370.6M in cash and it has $499M pro forma after a recent financing. Management has guided to a burn of $105-115M in 2016; we believe it has sufficient cash to see it through both NEOD001 studies, at least.

At ASCO, EHA or ISA, there should be data from 42 patients treated for at least 9 months with 24mg/kg NEOD001. There are 15 patients with cardiac involvement assessed for changes in NT-proBNP - the primary endpoint for PRONTO. Robust responses seen in the MAD study lay the foundation for similar results in this cohort. These upcoming data are a further de-risking event for PRONTO and look to durability of response and potential effect of starting with a higher dose.

No change to Outperform rating but the PT drops to $77 from $81 due to the adjustment of NEOD001 launch timing.

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Shares of Prothena Corp closed at $31.89 yesterday.