By Michael Elkins
Jefferies upgraded Esperion Therapeutics (NASDAQ:ESPR) to a Buy rating (From Hold) and doubled the price target on the stock to $6.00 (From $12.00) following incrementally positive management comments heading into the CLEAR CV outcomes data at ACC on March 4th.
Jefferies analysts are confident ESPR should meet or beat the Street's 15% cardiovascular benefit "bar," but even if risk reduction is more modest, they think the totality of the data including having a strong benefit on key secondary endpoints would still look attractive to docs as an oral LDL option and help drive a sales inflection.
The analysts wrote in a note, "Sentiment has been challenging given a lackluster US bempedoic acid launch weighed down by high OpEx and debt obligations, but we think the setup has improved after the pullback and expectations aren't overly high into ACC. There have been two big investor debates around the stock including (1) the magnitude of the CV benefit in the Phase III CLEAR outcomes data and what's clinically meaningful and (2) the cash runway given ESPR's cost structure with $167M cash but burning ~$40-45M+ per quarter and $665M of debt obligations. We acknowledge the path forward might not be easy, but recent management commentary and body language suggest these two key issues seem addressable if investors are willing to be patient."
ESPR has $167M of cash (~12-month runway) and will provide updated 2023 guidance at ACC including details on key OpEx and milestone assumptions.
Shares of ESPR are up 4.89% in mid-day trading on Friday.