On Tuesday, Oppenheimer adjusted its outlook on shares of Apellis Pharmaceuticals (NASDAQ:APLS), reducing the price target from $79.00 to $65.00 while maintaining an Outperform rating.
This action follows the news that the European Medicines Agency's Committee for Medicinal Products for Human Use (CHMP) issued a negative opinion regarding the marketing authorization of Apellis's drug pegcetacoplan for the treatment of geographic atrophy (GA).
Apellis Pharmaceuticals intends to request a re-examination of the CHMP's decision, anticipating a final opinion in the fourth quarter of 2024. The re-examination will include updated GALE data, which the company believes will be favorable.
Despite the negative opinion from CHMP, which was expected due to the process being led by the original rapporteurs, Apellis plans to incorporate the new rapporteurs assigned by CHMP for the re-examination.
The revision in the stock price target to $65 is attributed to the removal of EU Syfovre valuation from Oppenheimer's model, directly linked to the CHMP's recent stance. Still, the firm remains optimistic about the stock's potential, citing the current lower valuation as a reason to reiterate the Outperform rating.
Oppenheimer's stance is based on the potential undervaluation of Apellis's stock in light of recent developments. The firm believes that despite the setback with the CHMP, the prospects for Apellis remain positive, especially with the possibility of a more favorable outcome after the re-examination later this year.
In other recent news, Apellis Pharmaceuticals has faced several developments. The company's pursuit of European regulatory approval for pegcetacoplan, marketed as Syfovre, encountered a setback as the European Medicines Agency's Committee for Medicinal Products for Human Use issued a negative opinion on the drug.
In response, Apellis intends to request a re-examination of the decision. Amid this, Mizuho Securities and Wells Fargo adjusted their price targets for Apellis shares, citing the European approval setback and increased competition, respectively. Still, TD Cowen reaffirmed a Buy rating for the company.
On the financial front, Apellis reported a successful Q1 2024, with net sales of its geographic atrophy treatment, SYFOVRE, reaching $137.5 million, marking a 20% increase from the previous quarter. EMPAVELI, the treatment for paroxysmal nocturnal hemoglobinuria, generated $26 million in revenue.
Moreover, Apellis secured a senior-secured credit facility that could provide up to $475 million through a partnership with Sixth Street, expected to reduce non-operating cash requirements by approximately $222 million through 2027. These are some of the recent developments involving Apellis Pharmaceuticals.
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