Why This BeiGene Analyst Slashes Forecast By Almost 42%

BeiGene Ltd BGNE declined in early trading on Friday, maintaining its downward trajectory through the week amid weakness in Chinese stocks.

AbbVie’s ABBV patent case, which claims multiple infringements, is likely to be an overhang on BeiGene’s stock, according to Bernstein.

The BeiGene Analyst: Rebecca Liang downgraded the rating for BeiGene from Outperform to Market Perform, while slashing the price target from $335 to $196.

The BeiGene Thesis: It takes four to five years on average to settle a case, and BeiGene chances of winning in court “don't look great,” Liang said in the downgrade note.

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AbbVie’s claims “seem to stack up,” he added.

“The patent case not only exposes the vulnerability of BeiGene's single-asset-play to external blows, but also casts doubts on their long-presumed R&D leadership,” the analyst wrote.

Besides Brukinsa, there are no major growth drivers for BeiGene, he further stated.

BGNE Price Action: Shares of BeiGene had declined by 0.29% to $178.07 Friday at publication.

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