Analysts See 100% Upside To Rigel After Tavalisse Approval

Rigel Pharmaceuticals, Inc. RIGL announced Tuesday the approval of its Tavalisse for chronic immune thrombocytopenia — an achievement prompting a 14-percent pop in its stock price.

Analysts echoed investor enthusiasm, with H.C. Wainwright increasing its price target from $6.70 to $8 and BMO Capital Markets boosting its target from $6 to $8.

Here’s what they had to say.

The Theses

The FDA label expands Tavalisse’s addressable population to second-line, steroid-refractory patients, and it places the drug in competition with thrombopoietin-receptor agonists, including Amgen, Inc. AMGN’s Nplate and Novartis AG (ADR) AVS’s Promacta.

“We believe it may be priced close to current therapies (we project $100K annual cost per year),” H.C. Wainwright analysts Joseph Pantginis and Pete Stavropoulos wrote in a note.

Notably, BMO considers the option advantageous above — although clinically inferior to — thrombopoietin alternatives for its simple administration.

At the same time, the candidate has enduring opportunities in other indications.

“We expect additional upside to come from greater use in earlier treatment lines and accelerated development in AIHA [autoimmune hemolytic anemia],” BMO analyst Do Kim wrote in a note. “We believe a similar label for AIHA could nearly double our Tavalisse peak sales estimate to $1.1 billion.”

Rigel expects a late-May launch in the U.S. and fourth-quarter filing in the EU ahead of signing an international partnership, which BMO predicts will unlock additional upside.

Upcoming catalysts include a pipeline expansion with R835 and approval of fostamatinib, the latter of which is only partially priced into the stock, according to H.C. Wainwright.