HC Wainwright Hikes Karyopharm Price Target On Accelerated Drug Approval

After initial hiccups such as a tough FDA panel briefing document and a not-so-favorable panel verdict, Karyopharm Therapeutics Inc KPTI managed to secure approval for its multiple myeloma treatment Xpovio three days ahead of the given PDUFA date.

The Analyst

H.C. Wainwright analyst Edward White maintained a Buy rating on Karyopharm and raised the price target from $29 to $32.

The Thesis

The FDA's decision to approve Xpovio was based on the overall response rate of 25.3% in the 83-patient subgroup of the Phase 2b STORM trial, White said in a Friday note. (See his track record here.) 

The label — which was spared from black box labeling or contra-indications — is compelling and in-line with expectations, the analyst said. 

Karyopharm has hired a salesforce and nursing liaisons, negotiated with payors for removing access barriers and stocked ample supplies of Xpovio for the commercial launch, scheduled on or before July 10, White said. 

Xpovio's wholesale acquisition price is $22,000 for four weekly blister packs, the analyst said.

H.C. Wainwright estimates the sales potential in the penta-refractory setting to be $5.5 million in 2019, rising to $123.8 million in 2026.

The company is expected to release top-line data from the Phase 3 BOSTON trial, which is to serve as a confirmatory trial following the accelerated approval, by the end of 2019 or early 2020, White said. 

Karyopharm is also evaluating Xpovio in a Phase 2b trial for relapsing/refractory diffuse large B-cell lymphoma, with an NDA filing expected for the indication in the first half of 2020, he said. 

A Phase 3 trial evaluating the drug for endometrial cancer will complete enrollment in the second half of 2020, and a top-line Phase 3 readout for the drug in liposarcoma is likely to be released on the same timeline, according to H.C. Wainwright. 

The Price Action

After surging over 36% in Wednesday's regular session in reaction to an inadvertent website update on the approval, Karyopharm shares were down 0.29% at $8.87 at the time of publication Friday. 

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