Leerink initiated coverage of Spark Therapeutics (NASDAQ:ONCE) with an “outperform” rating and $85 price target. The stock closed at $63.06 on Jan. 8.
“While the stock has been a strong performer due to encouraging progress for voretigene neparvovec (VN) in RPE65-mediated blindness and SPK-9001 in hemophilia B, translating into some strong expectations for the pipeline, we believe a premium is warranted to reflect the company’s deep gene therapy expertise,” writes analyst Joseph Schwartz.
“We see further upside for the stock driven by advancement of these programs and news flow from the pipeline,” he added.
Mr. Schwartz said clinical data for VN and SPK-9001 to date demonstrates the ability of the company’s technology to generate sufficient gene expression in a fairly predictable manner and without extreme variability.
“We believe this kind of a profile is important for regulators, physicians, patients and payers,” he added.
Within the RPE65 indications, Mr. Schwartz’s model assumes 90% and 80% probabilities of success for VN being approved and commercialized for RPE65-mediated Leber’s congenital amaurosis and retinitis pigmentosa, respectively, in U.S. and EU.
