On Thursday, H.C. Wainwright adjusted its price target for shares of Viridian Therapeutics (NASDAQ: VRDN), bringing it down to $27 from the previous $37, while still recommending a Buy rating for the stock. The firm's decision comes in the wake of Amgen (NASDAQ:AMGN)'s first-quarter sales report for Tepezza, a treatment for thyroid eye disease (TED). Despite a seasonal dip from the fourth quarter of 2023's $441 million to $419 million, sales showed only a slight increase from the first quarter of 2023's $405.3 million.
Recent sales figures have not demonstrated a clear growth trajectory for Tepezza over the past 12 to 18 months. The completion of Amgen's acquisition in October was anticipated to lead to a normalization in execution, but this has yet to be observed. A significant development occurred in April 2023 when the FDA broadened Tepezza's label to include all adults with TED, an action that was expected to substantially boost sales. However, this label expansion has not yet visibly influenced sales growth.
In July 2023, an update to the product's label regarding the risk of hearing loss seems to have negated the anticipated positive effects of the expanded label. Despite these challenges, H.C. Wainwright remains confident in the effectiveness of VRDN-001, Viridian's own TED treatment. VRDN-001 has demonstrated favorable efficacy data in comparison to Tepezza and offers an easier administration process.
Nevertheless, due to the current market conditions and the less than anticipated impact of label changes on Tepezza sales, H.C. Wainwright has revised its peak sales estimates for VRDN-001 and VRDN-003 downwards to $1.4 billion from the previous $1.8 billion. This revision has led to the lowered price target for Viridian Therapeutics, as the firm adopts a more cautious perspective on the market's potential.
InvestingPro Insights
As investors consider H.C. Wainwright's revised price target for Viridian Therapeutics (NASDAQ: VRDN), it's crucial to look at the company's financial health and market performance. According to InvestingPro data, Viridian Therapeutics currently holds a market capitalization of $950.95 million, with a notably high negative P/E ratio of -3.43, reflecting the market's expectations of future growth despite current unprofitability. The company's revenue for the last twelve months as of Q1 2024 stands at a modest $0.29 million, experiencing a significant decline of -82.59%.
Two InvestingPro Tips that are particularly relevant for Viridian Therapeutics are that the company holds more cash than debt on its balance sheet, which provides a cushion for operational flexibility, and that liquid assets exceed short-term obligations, indicating a strong short-term financial position. However, it's important to note that analysts do not anticipate the company will be profitable this year and expect a sales decline in the current year, which aligns with the concerns expressed by H.C. Wainwright regarding the market's potential and sales estimates for VRDN-001 and VRDN-003.
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