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Potential CELG moves on ASH dataFrom Canaccord.... Estimates Revised Potential CELG moves on ASH data: dissecting multiple scenarios; BUY, $140 PT bb21217 and JCARH125 data could provide ~$8 in upside with sufficient de-risking We believe that positive data for bb21217 and JCARH125 could be the highlight of ASH 2018 for CELG, with a potential ~$8 in upside if data de-risks the programs by ~20% (which we think is an achievable metric). Based on our assumptions, we think that reasonably positive data would increase probability of success from 0% to 20%, and could yield a blended incremental value to CELG shares worth ~$8, which is an average of the value of bb21217 ($7) and JCARH125 ($9) at 20% probability of success since we lack clarity on which program will eventually be pushed to market by CELG. Furthermore, we think the downside risk could be minimal, as we do not see the Street including bb21217 and JCARH125 in models, and since bb2121 is much later in development. We provide scenario/sensitivity analysis on JCARH125 and bb21217 on page 5 and 6. Luspatercept MDS data another key catalyst; Potential ~$2 upside We expect positive luspatercept data details in b-thalassemia and MDS at ASH, but we attribute much more value to the MDS indication. Currently, we estimate both indications launch in 2020, but only ~$53M in worldwide sales for b-thalassemia vs. ~$1.3B in sales for MDS by 2025. Positive data were already reported by CELG and XLRN in the primary endpoint(s) and certain secondary endpoints, but we look for duration of transfusion independence and magnitude of difference between treatment and placebo arms as incremental value generators. We currently attribute ~$3 to luspatercept for the MDS indication and think that positive data in these value generators could contribute an additional ~$2 for CELG shares. We provide scenario/sensitivity analysis on luspatercept on page 10. Other data readouts may not move the needle, likely incremental Other potential data points for CELG at ASH 2018 could involve Revlimid and IDHIFA. We are likely to see positive Phase 3 AUGMENT data on Revlimid + Rituximab in r/r indolent lymphoma patients, as a previous press release detailed highly stat sig improvements in PFS and a favorable trend was seen in OS. We see these data as incremental, and believe that investor focus has widely shifted to larger potential catalysts, such as the CAR-T pipeline and luspatercept data readouts. For IDHIFA, we could see (1) Phase 1/2 data on enasidenib + azacitadine or (2) Phase 1b data in enasidenib + 7+3 chemotherapy. However, we view these catalysts as more meaningful for AGIO vs CELG at the present time. Maintain BUY, $140 PT We maintain our BUY rating and $140 PT based on our positive outlook on new product launches in 2019 and 2020 for ozanimod, bb2121, fedratinib, luspatercept, and liso-cel (JCAR017). We are encouraged by the recent developments in Revlimid, Abraxane, and the luspatercept program, which should help bolster revenue growth, and we continue to hold a strong outlook on the bb2121 program in RRMM. Here's a link to the full report: |
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Msg # | Subject | Author | Recs | Date Posted |
220745 | Re: Potential CELG moves on ASH data | Cordari30 | 0 | 10/15/2018 4:43:02 PM |
220748 | Re: Potential CELG moves on ASH data | JBWIN | 28 | 10/15/2018 9:02:38 PM |