On Monday, Barclays reaffirmed its Overweight rating on shares of BioMarin Pharmaceutical Inc. (NASDAQ:BMRN), along with a steady price target of $110.00. The firm's analysis highlighted recent Phase 3 trial results from competitor Ascendis Pharma (NASDAQ:ASND) for their TransCon CNP product, which is being evaluated for children with achondroplasia, a form of dwarfism.
Ascendis Pharma's trial, named ApproaCH, reported annualized growth velocity (AGV) changes from baseline at 52 weeks, with a 1.78 cm/year increase for children aged 5-11 and a 1.15 cm/year increase for the 2-5 year group. These results yield a weighted average AGV change of 1.38 cm/year according to Barclays' calculations. The data is seen as potentially approvable, showing slightly better or similar efficacy compared to BioMarin's Voxzogo, which reported a 1.31 cm/year change under a similar patient age distribution.
Barclays noted that there are several critical factors that require consideration before drawing definitive comparisons between the ApproaCH and Voxzogo studies. One is the significantly smaller baseline AGV in the ApproaCH trial compared to the Voxzogo Phase 2/3 studies and natural history data.
Additionally, the age group in the ApproaCH trial is younger (5-11 years old) compared to the Voxzogo Phase 3 trial (5-18 years old), and the ApproaCH trial included a higher percentage of male participants (54%) than the Voxzogo Phase 3 trial (47%).
The firm is also awaiting two-year data to better define the clinical profile of the treatment, which will be informed by feedback from key opinion leaders (KOLs).
Commercial considerations such as dosing convenience, including frequency of dosing, gauge size, and volume, are also factors that Barclays believes will play a role in the competitive landscape. Lastly, the intellectual property (IP) situation is expected to further delineate the market dynamics between the competing therapies.
In other recent news, Ascendis Pharma has made significant strides in its drug development and financial growth. The company's Phase 3 ApproaCH study for its drug TransCon CNP in treating achondroplasia yielded successful results, leading to Goldman Sachs, BofA Securities, and Stifel maintaining Buy ratings on Ascendis Pharma shares and setting price targets of $200, $175, and $200 respectively. Citi also reaffirmed its Buy rating, maintaining a price target of $178.
Ascendis Pharma is preparing to seek regulatory approval for TransCon CNP, with plans to file in the United States in the first quarter of 2025 and in the European Union in the third quarter of 2025. The company's other drug, TransCon IL-2 β/γ, showed promising signs of clinical activity in patients with platinum-resistant ovarian cancer in its ongoing Phase 1/2 IL-Believe Trial.
The company secured a new funding agreement with Royalty Pharma worth $150 million and received U.S. approval for its product YORVIPATH for adult hypoparathyroidism. Ascendis Pharma's R&D costs decreased by 21% year-over-year, while SG&A expenses increased due to higher employee costs.
The company ended the quarter with EUR259 million in cash and equivalents, with forecasts for SKYTROFA revenue set at EUR220 million to EUR240 million for the full year of 2024.
InvestingPro Insights
As Ascendis Pharma (ASND) continues to make headlines with its Phase 3 trial results, it's important to consider the company's financial health and market performance. According to InvestingPro data, Ascendis Pharma has a market capitalization of $6.84 billion, which is a significant figure in the biopharmaceutical industry. Despite the potential of their TransCon CNP product, the company's P/E ratio stands at -12.27, reflecting market skepticism about future earnings. Furthermore, Ascendis Pharma's revenue growth has been striking, with a 166.54% increase in the last twelve months as of Q2 2024, indicating a strong expansion in its financial activities.
However, InvestingPro Tips suggest caution. Analysts have revised their earnings expectations downwards for the upcoming period, signaling potential concerns about the company's profitability. In addition, Ascendis Pharma is currently trading at a high revenue valuation multiple, which could imply that the stock is overvalued based on its current revenue generation. Despite these challenges, Ascendis Pharma has shown a high return over the last decade, which may attract long-term investors. It should be noted that the company does not pay a dividend, which could be a consideration for income-focused shareholders.
For readers interested in a deeper analysis, there are additional InvestingPro Tips available at https://www.investing.com/pro/ASND, which can provide further guidance on Ascendis Pharma's financial position and market performance.
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