Oppenheimer: Axovant Deal Transform Pipeline

Axovant Sciences Ltd AXON announced Wednesday that it licensed global rights to Oxford BioMedica’s investigational gene therapy for Parkinson’s Disease.

As some experts see it, the drug could be a game changer.

The Rating

Oppenheimer analysts Jay Olson and Silvan Tuerkcan maintained a Perform rating on the stock.

The Thesis

By the analysts’ assessment, the AXO-Lenti-PD candidate improves on the efficacy and dosing constraints of its ProSavin precursor, which heightens its prospects.

“We believe [the] deal leverages AXON's expertise in early and late-stage clinical development along with pre-launch commercial capabilities,” Olson and Tuerkcan wrote in a note.

It additionally pivots Axovant’s pipeline from small molecules to gene therapy — a play advancing a larger strategy expected to unfold throughout the year.

“We are encouraged by the rapid progress of new CEO Pavan Cheruvu as he quickly implements his vision for a new AXON that is focused on transformational science,” they wrote.

The old Axovant had been built on an Alzheimer's drug that eventually failed clinical trials last September. The stock faded 94 percent off that candidate's discontinuation but picked up on the latest opportunity.

Price Action

At time of publication, shares were trading up 40.2 percent at a rate of $6.38. The stock was trading under the $2 level before Wednesday's news.

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