On Friday, Jefferies updated its outlook on argenx SE (NASDAQ: ARGX), raising the price target to $707.00 from the previous $689.00 while sustaining a Buy rating on the stock. The analyst highlighted the company's positive data across all three myositis subsets, noting the clear signal in both primary and secondary endpoints, including the time to response and depth of responses observed.
The firm's analysis pointed out that argenx has recently received data that may prompt quick adjustments to the Phase 3 portion of their study. The company has a history of aligning with regulatory expectations and plans to use the combined Phase 2/3 study as a basis for filing, although the timeline for this remains undetermined. Additionally, argenx is evaluating the total addressable market (TAM) for myositis, with a particular focus on subsets that have a lower standard of care.
In the area of generalized myasthenia gravis (gMG) and chronic inflammatory demyelinating polyneuropathy (CIDP), argenx expects consistent quarter-over-quarter growth in gMG and a steady increase in CIDP, especially in the fourth quarter. The company is cautious about comparing CIDP's growth trajectory to gMG due to the different dynamics in treatment switching and potential higher dropout rates. However, argenx is encouraged by current CIDP payer policies, which are generally favorable to patients transitioning from steroids or intravenous immunoglobulins (IVIG).
Argenx (NASDAQ:ARGX) also has plans to expand indications for Vyvgart, its lead product. The company is considering moving directly from proof of concept to Phase 3 trials with data from its partnership with Zai Lab (NASDAQ:ZLAB), although lupus nephritis data is not expected to be ready by the J.P. Morgan Healthcare Conference.
The firm is also conducting a Phase 3 trial for Sjogren's syndrome and has increased the number of investigator-initiated studies to explore new indications and generate biomarker data swiftly.
Lastly, argenx is focused on achieving operating leverage and maintaining discipline in its selling, general, and administrative (SG&A) expenses. The company anticipates limited growth in SG&A expenses, particularly in the European Union where they already have commercial scale. According to the analyst, argenx is not specifying R&D figures as they prefer to maintain flexibility to invest in innovation.
In other recent news, argenx SE has made significant strides in the biotechnology sector. The company reported positive clinical trial results for the treatment of myositis, a chronic inflammatory condition, with its drug, efgartigimod.
This led to a series of analyst upgrades, including Oppenheimer adjusting its price target for argenx SE to $675 and maintaining an Outperform rating on the stock. Similarly, Barclays (LON:BARC) increased its price target from EUR650.00 to EUR670.00, while Raymond (NS:RYMD) James boosted argenx's price target to $770, based on positive results from a Phase 2 trial.
Wolfe Research upgraded argenx's stock, predicting a rise in earnings partly due to its performance in myasthenia gravis (MG) and PFS. The firm forecasts that 2025 will mark argenx's first profitable year. Scotiabank (TSX:BNS) significantly increased its price target for argenx to $715, attributing it to the promising sales and potential of efgartigimod, particularly in the MG treatment market.
These recent developments have followed argenx's significant earnings and revenue results, with third-quarter net product revenue reaching $573 million, surpassing estimates set by Oppenheimer and consensus forecasts. The company continues to focus on high-impact programs and robust sales growth. These are the recent developments for argenx SE.
InvestingPro Insights
Argenx SE's recent performance and future prospects align well with several key metrics and insights from InvestingPro. The company's revenue growth of 85.56% over the last twelve months and 73.28% in the most recent quarter underscores the strong market reception of its products, particularly Vyvgart. This robust growth supports Jefferies' optimistic outlook and increased price target.
InvestingPro Tips highlight that argenx holds more cash than debt on its balance sheet, which provides financial flexibility to fund its ambitious expansion plans and clinical trials. Additionally, the expectation that net income will grow this year aligns with the company's focus on achieving operating leverage and disciplining SG&A expenses.
The stock's strong return over the last three months (14.84%) and significant price uptick over the last six months (64.06%) reflect investor confidence in argenx's pipeline and commercial progress. This momentum is further supported by the fact that the stock is trading near its 52-week high, with its current price at 98.67% of the 52-week high.
For investors seeking more comprehensive analysis, InvestingPro offers 12 additional tips for argenx, providing a deeper understanding of the company's financial health and market position.
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