On Thursday, BMO Capital Markets maintained its underperform rating on shares of Incyte (NASDAQ:INCY) Corporation (NASDAQ:INCY), with a consistent price target of $48.00. The decision followed the recent approval by the U.S. Food and Drug Administration (FDA) of axatilimab, now branded as Niktimvo, for use in third-line chronic graft-versus-host disease (3L+ cGVHD).
While the approval arrived earlier than the anticipated date of August 28, 2024, the analyst from BMO Capital noted that this development was largely anticipated by investors and provides only a modest boost to Incyte's stock.
The newly approved Niktimvo represents a relatively small market opportunity, with BMO Capital estimating peak sales to reach approximately $200 million.
This figure is considered minor in comparison to the potential revenue loss Incyte could face due to the loss of exclusivity (LOE) of its drug Jakafi in 2028. Despite the FDA's nod for Niktimvo, the firm believes that this event does not significantly alter the overall narrative for Incyte.
The analyst emphasized the need for Incyte to demonstrate progress in its pipeline, particularly for assets targeting larger indication areas. This comment comes in the wake of Incyte's recent announcement of a $2 billion share buyback program. BMO Capital's stance reflects a cautious outlook on the company's ability to offset impending challenges with its current portfolio and pipeline developments.
Incyte's stock performance and investor sentiment may be influenced by the company's strategic moves and the success of its pipeline in addressing larger market opportunities. The company's focus on innovation and growth in areas beyond its current flagship products will be closely monitored by stakeholders and industry observers.
In other recent news, Incyte Corporation has been in the spotlight for several key developments. The biopharmaceutical company's drug axatilimab received approval, leading RBC Capital Markets to raise its price target from $66 to $67 while maintaining a Sector Perform rating on the stock. The drug's potential for generating over $450 million in out-year revenue was emphasized, which could offset the loss of exclusivity for the company's flagship product, Jakafi.
Incyte also reported a 9% increase in total revenues from the previous year, reaching $1.4 billion for the second quarter of 2024. This growth was largely driven by the company's key products, Jakafi and Opzelura, with net product revenues of $706 million and $122 million, respectively. The company's pipeline transformation, which includes new clinical programs, is set to launch over 10 high-impact products by 2030.
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