Proactive Investors - AstraZeneca (LON:AZN) saw another £4 billion wiped off its value as top city firm Deutsche Bank (ETR:DBKGn) cut its recommendation to ‘sell’ following the latest update on lung cancer drug datopotamab.
Deutsche Bank said it had already reduced its expectations for the drug, but the recent update on biomarker data confirmed its fears and raised new ones.
Dato is not the only important pipeline prospect for AZN, Deutsche Bank said, but “it is a key building block of the HSD H2’20s revenue guide and now looks in question”.
“We think a difficult December Adcom/PDUFA coupled with downside risk into FY25 guidance and ‘25s key catalysts being H2’25 skewed means risk-reward has now become outright challenging on a 6-12 month view”.
The bank added that its forecasts are materially below mid-term consensus and company guidance, something that is not reflected in the current valuation (19 times FY25 P/E).
'Sell' is now the investment rating, from 'hold' previously, with a reduced target price of 10,500p.