Cantor Fitzgerald launched coverage of Akebia Therapeutics (NASDAQ:AKBA) with an “overweight” rating and $8 price target. The stock closed at $3.41 on March 5.
The company’s lead asset, vadadustat, is an oral hypoxia-inducible factor (HIF) prolyl hydroxylase (PH) inhibitor that mimics how the body responds in altitude environments to treat anemia patients with chronic kidney disease (CKD).
“This target is based on Nobel Prize winning science in 2019, but more importantly for the stock, we see real commercial potential for this novel mechanism of action in an already established market for treatment of anemia for CKD patients,” writes analyst, Alethia Young.
“Over the next 12 months, we think that Akebia shares will continue to recover as we remain confident in vadadustat’s approval for the treatment of anemia for CKD,” she added.
Ms. Young also said the current valuation underestimates the commercial potential likely due to the fact that “investors have lowered expectations for the entire product after the non-inferiority margin on major adverse cardiovascular events was not met in the non-dialysis study.”
But she said that at “100% probability of success for dialysis sales only, our valuation would be $10 a share, a 193% upside from the current market price.”
