On Monday, PTC Therapeutics (NASDAQ:PTCT) stock received an upgrade from Raymond James from Underperform to Market Perform. This rating change follows the European Commission's (EC) recent decision not to endorse the Committee for Medicinal Products for Human Use’s (CHMP) advice to withdraw Translarna from the European market.
The EC's decision comes after the CHMP issued two negative opinions on the renewal of Translarna's conditional marketing authorization in Europe for the treatment of Duchenne muscular dystrophy (DMD) patients with nonsense mutations (nmDMD). The CHMP had also recommended that the drug be removed from the market, a move that was anticipated to be confirmed by the EC in early April.
In a surprising turn of events, the EC has declined to follow the CHMP's recommendation and has instead requested a re-evaluation of the drug. The EC has stipulated that the CHMP's future assessments should not include input from the Scientific Advisory Group (SAG) meeting from last fall, which had initially led to the recommendation for the drug's removal.
The EC has instructed the CHMP to give additional consideration to data from patient registries and real-world evidence. This directive suggests a potential shift in the CHMP's stance on Translarna in the future. In response to these developments, Raymond James has reintroduced Translarna EU revenues into their financial model, leading to the updated rating for PTC (NASDAQ:PTC) Therapeutics.
InvestingPro Insights
Following the recent update from Raymond James on PTC Therapeutics, investors might be interested in some key metrics and insights that could influence their decision-making. According to InvestingPro data, PTC Therapeutics has a market capitalization of $3.01 billion and has experienced a revenue growth of 20.39% over the last twelve months as of Q1 2024. Despite this growth, analysts do not expect the company to be profitable this year, with the company not having been profitable over the last twelve months. This is reflected in a negative P/E ratio of -4.34 and an adjusted P/E ratio of -6.63.
On a more positive note, PTC Therapeutics has seen strong returns over various time frames, with a 30.71% return over the last month and a 49.28% return over the last six months. This suggests a significant market confidence rebound, possibly linked to recent events such as the EC's decision on Translarna. However, it's important to note that the company does not pay a dividend to shareholders, which may be a consideration for those looking for income-generating investments.
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