BioMarin Presents ~20% Upside Amid Voxzogo's Success and Slow Roctavian Uptake, Analyst Says

BMO Capital Markets has upgraded BioMarin Pharmaceutical Inc BMRN to Outperform from Market Perform, and the price target remains at $102, noting its skewed risk/reward.

Friday, the FDA approved BioMarin's Roctavian (valoctocogene roxaparvovec-rvox) gene therapy for adults with severe hemophilia A without antibodies to adeno-associated virus serotype 5.

The analyst expects Roctavian's uptake to be (s)lower than consensus expectations, and it continues to model ~$65 million /$900 million in total Roctavian 2023/peak sales (vs. ~$83 million/ $1,400 million for consensus). 

The analyst says its expectations remain unchanged since January 2023 (vs. ~$215 million /$1,600 million for consensus in January 2023).

The analyst also says that at this valuation (-25% since initiated coverage here), Roctavian constitutes an upside opportunity as it's primarily not priced in.

Also Read: BioMarin's Roctavian US Launch: Focus on Commercial Strategy Amid EU Failures, Analyst Points Out.

BMO analyst says Voxzogo's launch has been very successful in Achondroplasia and constitutes a significant growth driver for BioMarin. 

At the same time, recent data from BridgeBio Pharma Inc BBIO Infigratinib in Phase 2 suggests that Infigratinib can gain significant market share in Achondroplasia, especially given Infigratinib's clean safety and oral administration. 12-month Phase 2 Infigratinib data is awaited to assess its impact further. 

Noting Roctavian's (s)low uptake and Infigratinib's impact, BMO sees ~20% upside in BioMarin. The analyst also says that Voxzogo is largely not priced in at these levels (~$86/share) and, therefore, Roctavian's contribution offers an upside opportunity moving forward. 

Price Action: BMRN shares are up 1.63% at $87.30 on the last check Wednesday.