On Tuesday, Barclays (LON:BARC) upgraded argenx SE (ARGX:BB) (NASDAQ: ARGX) stock from Equalweight to Overweight, significantly increasing the price target to EUR580.00 from the previous EUR390.00.
The upgrade follows a reassessment of the company's long-term value and the potential of its product Vyvgart in treating chronic inflammatory demyelinating polyneuropathy (CIDP).
The analyst from Barclays pointed out that the initial downgrade of argenx SE's stock in December 2023 was a reaction to the failure of its Phase 3 ADDRESS PV trial.
At the time, the future seemed uncertain due to the early-stage pipeline and the perceived overestimation of Vyvgart's market impact. However, the sentiment has shifted, with a new focus on the substantial net present value (NPV) for CIDP, bolstered by positive feedback from key opinion leaders (KOLs).
Recent strong results and an R&D day in New York prompted a reevaluation of argenx SE's prospects. The analyst's updated patient models now project increased quarterly revenue for the treatment of myasthenia gravis (MG) and CIDP across the United States, Europe, and Japan.
These changes also incorporate the anticipated benefits of a prolonged progression-free survival (PFS) from the end of 2024, which is expected to boost drug uptake through a new self-administration option.
Additionally, there is optimism surrounding the expansion of Vyvgart's use into additional patient groups. The analyst expects that the treatment may be extended to seronegative MG and immune thrombocytopenia (ITP) patients in the US, pending a probability-adjusted forecast. This potential expansion could further enhance argenx SE's market position and justify the upgraded stock rating and price target.
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