Stifel raised its price target for Xenon Pharmaceuticals (NASDAQ:XENE) to $31 from $23, ahead of Phase 2b focal seizure data expected in the third quarter this year. The stock closed at $17.97 on April 23.
“From our additional research, we can’t find any glaring holes in the argument that XEN1101 should recapitulate the efficacy of predecessor compound, ezogabine, on seizure reduction,” writes analyst Paul Matteis.
“We also think there’s a strong, data-driven case that XEN1101 can avoid ezogabine’s safety baggage (skin pigmentation, urinary retention), and as a once-daily medicine, XEN1101 should be better tolerated,” he added.
According to Mr. Matteis, the partial seizure market is highly genericized, but there’s still a large treatment-refractory population of more than 500,000 patients. “While there’s some debate surrounding the total addressable market in epilepsy, we think an underappreciated angle for the stock and for this event is the possibility that good seizure data could price in optionality for XEN1101 in depression,” he said.
Mr. Matteis also said “recent, under-the-radar ezogabine data in major depressive disorder look promising and add another development angle for XEN1101, which Xenon is funded to pursue.”
