Biotech companies remain in the headlines post-outbreak of the pandemic and the pursuant need for treatments and vaccines. Though the coronavirus treatments remain the priority, other regulatory and pipeline developments have rebounded after having been impacted by the pandemic.
For healthcare stocks, factors including clinical trial data, regulatory decisions, and successful commercialization of drugs are sometimes much more important than earnings results in evaluating the prospects of the company. That’s because a few years are needed for any newly-approved drug to contribute to the company’s top line, as it involves huge R&D costs.
Among such companies, uniQure N.V. (NASDAQ: QURE), a gene therapy company, has seen its shares decline around 34% in the past year. The clinical hold on its hemophilia B gene therapy program, including the pivotal, Phase III HOPE-B study last December, by the U.S. Food and Drug Administration (FDA), was a critical factor for the decline.
On the other hand, the company, which is focused on advancing transformative therapies for patients suffering from genetic and other devastating diseases, has experienced long-term gains of around 271% over the past five years. Notably, uniQure’s proprietary gene therapies includes treatments for hemophilia B, Huntington’s disease, Fabry disease, spinocerebellar ataxia Type 3, and other diseases.
Recently, the company reported its second-quarter earnings results, which topped analysts’ expectations. The company reported earnings of $8.51 per share, which outpaced consensus estimates of $2.96. Notably, uniQure reported a loss of $0.96 per share in the same quarter last year. Revenues of $463.9 million jumped significantly on a year-over-year basis and beat the consensus estimate of $190.02 million.
Following the results and the pipeline update, Mizuho Securities analyst Difei Yang maintained a Buy rating and a price target of $52 (92.5% upside potential) on the stock.
Yang’s analysis stated that the Q2 results were “mostly uneventful.”
However, she considers the initial clinical data from the Huntington’s disease program to be the most significant catalyst for the company. The data is likely to be released by the end of this year for the first four patients treated (including two controls), and additional data to be released in 2022.
Management said, “… we continued to make strong progress in our U.S. Phase I/II study of AMT-130 in Huntington’s disease, including the completion of patient enrollment in the first dose cohort and the initiation of dosing in the second cohort.”
Inclusive of the payment received on the closing of the CSL Behring agreement, uniQure had a cash position of $677.3 million as of June 30. Yang, in line with management’s expectations, considers the funds to be sufficient for operations till the first half of 2024.
Notably, an additional amount of about $300 million which is expected, related to “regulatory submissions, first-commercial sales and certain development milestones related to the HemB gene therapy,” can extend the funding of operations by 18 months. Therefore, based on such positive anticipations, the analyst updated her model and maintained a bullish stance. (See uniQure stock charts on TipRanks)
On TipRanks, uniQure is a Strong Buy based on 9 Buys versus 1 Hold. The average uniQure price target of $59.14 implies upside potential of 119% from the current levels.
TipRanks’ Stock Investors tool shows that investors currently have a Very Positive stance on uniQure, with 2.1% of investors maintaining portfolios on TipRanks increasing their exposure to QURE stock over the past seven days.
Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your analysis before making any investment.
