Why This ChemoCentryx Analyst Is Bullish

H.C. Wainwright analysts remain bullish on ChemoCentryx, Inc. CCXI following an amended new drug application for avacopan.

The ChemoCentryx Analyst: Edward White reaffirmed a  Buy rating on shares of ChemoCentryx, Inc. with a $28 price target. 

The ChemoCentryx Takeaways: In the first week of May, shares of ChemoCentryx plunged nearly 80% following a critical FDA note regarding avacopan, a treatment for anti-neutrophil cytoplasmic antibody-associated vasculitis. 

ChemoCentryx announced Tuesday it filed an amended NDA to the FDA for avacopan. The filing is a major amendment to the NDA, according to the FDA, and will push avacopan’s approval consideration date to as late as Oct. 7 from the originally scheduled July 7 date, the analyst said. 

The amended NDA is based on data from the Phase 3 Advocate study, which evaluated the efficacy and safety of avacopan in 331 AAV patients following 26 and 52 weeks of continuous treatment, he said. 

“Probability-adjusted revenue forecasts [through 2028] for avacopan in AAV, C3G, and severe HS” were used in developing the net present value model to price shares of ChemoCentryx, White said.

Sales for avacopan in AAV are estimated at $5 million in 2021, growing to $101 million in 2022, the analyst said.

The model also utilized a 3x price/sales multiple and a 20% discount rate in line with peers and “within the typical range for products in development,” White said.

CCXI Price Action: Shares of ChemoCentryx, Inc. were up 7.74% to $14.20 on Tuesday.