H.C. Wainwright has adjusted its outlook on Protagonist Therapeutics (NASDAQ: NASDAQ:PTGX), raising the price target to $50.00 from the previous $40.00 while keeping a Buy rating on the stock.
The adjustment follows recent discussions with Protagonist's management team, including CEO Dinesh Patel and Clinical Advisor Sam Saks MD, during the HCW Global Investment Conference on Wednesday.
The management team provided insights into the license and collaboration agreement with Takeda concerning the rusfertide program for the treatment of polycythemia vera (PV).
The agreement terms, particularly the opt-in/opt-out structure, are seen as highly beneficial for Protagonist, granting significant leverage as the company advances the asset into Phase 3 development independently.
Under the collaboration with Takeda, the two companies are set to co-develop and commercialize rusfertide, sharing profits in the United States and earning tiered royalties ranging from 10-17% outside the U.S. Protagonist retains the option to "opt-out," which would entitle the company to up to $1.6 billion in payments.
The company will have a 90-day window, commencing 120 days after the New Drug Application (NDA) filing, to decide whether to exercise this right.
Should Protagonist choose to "opt-in," it would have the opportunity to participate in commercialization activities. However, it is more likely that the company would adopt a passive role and simply collect its 50% share of the U.S. profits from rusfertide.
In other recent news, Protagonist Therapeutics has been the focus of several analyst reports. Truist Securities initiated coverage with a Buy rating, highlighting the potential of the company's lead asset showing strong Phase 2 data in treating rare blood cancer.
The company's second asset, targeting IL-23, was noted for being de-risked by already approved drugs in a multi-billion dollar market. Additionally, BTIG increased Protagonist Therapeutics' price target from $41.00 to $51.00, maintaining a Buy rating.
The company has also welcomed Newman Yeilding, M.D., as its Chief Scientific Advisor, bringing his wealth of experience from Janssen Pharmaceutical Companies of Johnson & Johnson. His expertise is expected to guide the company's research and development, particularly as Protagonist looks to expand its pipeline with promising drug candidates.
In terms of drug development, Protagonist Therapeutics has revealed updates in their pipeline. The completion date for the company's ANTHEM-UC Phase 2b study of JNJ-2113, a treatment for ulcerative colitis, has been moved to September 2024. The company has also announced its entry into the obesity treatment market, with further details to be disclosed later.
InvestingPro Insights
Following the upbeat outlook from H.C. Wainwright on Protagonist Therapeutics (NASDAQ:PTGX), InvestingPro data reveals a strong financial position and promising market performance. The company holds a market capitalization of $2.64 billion, reflecting a significant presence in the biotechnology sector. Notably, Protagonist Therapeutics has demonstrated impressive profitability metrics with a gross profit margin of 100% over the last twelve months leading up to Q2 2024, and an operating income margin of 47.71% in the same period. Additionally, the company has experienced substantial returns, with a year-to-date price total return of 95.33% and a one-year price total return of 138.12%, indicating robust investor confidence.
InvestingPro Tips highlight the company's solid financial foundation, as Protagonist holds more cash than debt, which is a positive sign for investors looking for a financially secure company. Furthermore, analysts predict sales growth and net income growth for the current year, suggesting a positive outlook for the company's financial performance. For those interested in further insights, InvestingPro offers additional tips on Protagonist Therapeutics, which can be found at https://www.investing.com/pro/PTGX.
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