On Friday, Oppenheimer adjusted its stock price target for Ascendis Pharma (NASDAQ:ASND), reducing it to $180 from the previous $190, while maintaining an Outperform rating on the stock. The adjustment follows Ascendis Pharma's third-quarter financial report, which displayed a net loss of €99.2 million. This figure came in below Oppenheimer's anticipated loss of €110.2 million, indicating that the company's management is effectively controlling expenses.
Skytrofa, one of Ascendis Pharma's products, recorded revenue of €47.2 million, falling short of the expected €50.0 million by Oppenheimer and €60.8 million consensus estimate. The year-over-year sales remained flat, attributed to higher sales deductions despite an increase in volume. Despite this, the company has again revised its sales guidance for Skytrofa, now setting the target at €200–220 million for the year 2024.
The firm's analyst pointed out that while Skytrofa's commercial performance is under pressure due to competition from Pfizer (NYSE:PFE) and Novo, the focus has shifted to Yorvipath, Ascendis Pharma's other product. Yorvipath is expected to be a primary driver for the company's stock in the upcoming quarters. The U.S. launch of Yorvipath is slated for mid-January, and it is anticipated to enter the market without direct competition, potentially benefiting from pent-up demand.
The analyst also addressed concerns regarding intellectual property that could potentially block TransCon CNP, another Ascendis Pharma product. Based on recent expert consultations, the analyst believes these concerns may be exaggerated and not as significant as some might fear.
In other recent news, Ascendis Pharma reported significant advancements and collaborations during its productive third quarter of 2024. The company's flagship product, SKYTROFA, experienced a 60% year-over-year volume increase, and the FDA-approved treatment for adult hypoparathyroidism, YORVIPATH, is set to launch in the U.S. with prescriptions starting in December 2024.
Ascendis Pharma also announced a strategic collaboration with Novo Nordisk (NYSE:NVO), which could lead to a $100 million upfront payment and royalties.
The company's financial performance was robust with a total product revenue of EUR 57.8 million for Q3 2024. Ascendis Pharma has also forecasted to achieve cash flow breakeven by the end of 2025. However, the company adjusted its revenue guidance for 2024 due to lower-than-expected volumes in Q3.
Furthermore, Ascendis Pharma is preparing for the market entry of TransCon CNP, with an NDA expected to be submitted in Q1 2025. The company's initiatives and collaborations are anticipated to drive growth through 2025, as it aims to establish leadership in growth disorders across more than 20 diseases. These are the recent developments in Ascendis Pharma's journey.
InvestingPro Insights
Ascendis Pharma's financial landscape, as revealed by InvestingPro data, offers additional context to the Oppenheimer analysis. The company's market capitalization stands at $7.43 billion, reflecting its significant presence in the biotech sector. Despite the recent price target reduction, Ascendis Pharma has demonstrated impressive revenue growth of 166.54% over the last twelve months, indicating strong product demand.
However, investors should note that the company is currently operating at a loss, with a negative P/E ratio of -14.84. This aligns with an InvestingPro Tip suggesting that analysts do not anticipate the company will be profitable this year. This information underscores the importance of Yorvipath's upcoming launch and its potential to drive future profitability.
Another relevant InvestingPro Tip highlights that Ascendis Pharma operates with a moderate level of debt. This could provide the company with financial flexibility as it navigates the competitive landscape and focuses on the commercialization of Yorvipath.
For investors seeking a more comprehensive analysis, InvestingPro offers 5 additional tips that could provide valuable insights into Ascendis Pharma's financial health and market position.
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