德银-美股-生物科技行业-2017年第三季度预览：如今乘着波浪，但它能持续多久？-20171019-Deutsche_Bank-Biotechnology：3Q17_Preview，Riding_the_Wave_For_Now，But_How_Long_Will_It_Last_33页_1mb

Biotechnology Sector Summary: 3Q17 Preview

Core Content

This report provides an analysis of the biotechnology sector, focusing on the third quarter of 2017 (3Q17). It highlights the key developments, earnings expectations, and strategic directions for several major biotech companies. The overall sentiment suggests that while the sector has seen a positive move, the sustainability of this momentum remains uncertain and depends heavily on upcoming clinical data and regulatory updates.

Main Points

1. Sector Momentum and Outlook

• The recent biotech rally, driven by the Kite acquisition by Gilead, has created a favorable sentiment shift.
• However, the momentum is primarily based on multiple expansion rather than improved near-term revenue or earnings.
• The 3Q17 results will be crucial in determining whether the sector can continue outperforming the broader market.
• Clinical data and regulatory/commercial catalysts are expected to be central to the rest of the year.

2. Key Companies and Their Outlook

• Amgen (AMGN - HOLD - $177 PT):

  • Continued strong performance from Neulasta and Sensipar.
  • Concerns around Repatha utilization and biosimilar competition.
  • Label expansions for Xgeva, Kyprolis, and erenumab may drive incremental growth.
  • Management commentary on strategic directions and long-term expectations will be important.

• Gilead (GILD - BUY - $90 PT):

  • The Kite acquisition is a key focus, providing a foundation for oncology expansion.
  • HIV franchise is expected to benefit from the launch of bictegravir.
  • HCV revenues are stabilizing, and the approval of Yescarta is anticipated to drive investor interest.
  • The company is expected to maintain its growth trajectory despite HCV erosion.

• Biogen (BIIB - BUY - $350 PT):

  • Strong performance from the MS franchise and Spinraza launch.
  • Improved strategic outlook following the Gilead/Kite deal.
  • Anticipated updates on long-term plans and the trajectory of the MS business.

• Alexion (ALXN - BUY - $158 PT):

  • Strong mid- and long-term growth guidance.
  • Anticipated clinical newsflow and regulatory decisions.
  • Potential headwinds from LatAm revenue due to competitive pressures.

• BioMarin (BMRN - BUY - $118 PT):

  • Confidence in reaching non-GAAP profitability this year.
  • Continued focus on the diversified and deep pipeline.
  • Commercial challenges in Brazil may impact guidance.

• Neurocrine (NBIX - BUY - $67 PT):

  • Launch of Ingrezza in TD expected to exceed expectations.
  • Anticipated updates on the ph2b trial for Ingrezza in pediatric Tourette syndrome.
  • NDA for elagolix in endometriosis recently filed, with Ph3 data in uterine fibroids expected.

• DBV Technologies (DBVT - BUY - $56 PT):

  • Pivotal phase-3 PEPITES data expected this month.
  • No quarterly call, so focus will be on the PEPITES results and commercial opportunity.

• Esperion (ESPR - BUY - $64 PT):

  • Strong bempedoic acid development plan.
  • Continued focus on clinical and regulatory risks.
  • Potential for blockbuster status as biosimilar competition increases.

• Prothena (PRTA - BUY - $73 PT):

  • Ongoing pivotal trials for NEOD001 in AL amyloidosis.
  • Potential for PRX002 in Parkinson's disease to gain more attention.
  • Early data suggests NEOD001 has significant benefit.

• Halozyme (HALO - BUY - $20 PT):

  • Potential updates on Keytruda + PEGPH20 and other collaborations.
  • PEGPH20 program in pancreatic cancer may benefit from delayed commercialization.

• Hutchison China MediTech (HCM - BUY - $36 PT):

  • Encouraging data from the World Lung Conference.
  • Strategic decisions from partners AstraZeneca and Eli Lilly will be of interest.
  • Timelines for key de-risking read-outs and pipeline progress will be important.

Key Information

• Target Prices and Ratings:

  • AMGN: $177 (Hold)
  • BIIB: $350 (Buy)
  • GILD: $90 (Buy)
  • ALXN: $158 (Buy)
  • BMRN: $118 (Buy)
  • DBVT: $56 (Buy)
  • ESPR: $64 (Buy)
  • NBIX: $67 (Buy)
  • PRTA: $73 (Buy)
  • HALO: $20 (Buy)
  • HCM: $36 (Buy)

• Earnings and Revenue Expectations:

  • Amgen's 3Q17 revenue is expected to be $5,838 million, with EPS at $3.14.
  • Gilead's 3Q17 revenue is projected at $6,324 million, with EPS at $2.10.
  • The report includes updated models and revised forecasts for all listed companies.

• Strategic and Clinical Catalysts:

  • Management commentary on strategic direction and long-term expectations will be crucial.
  • Upcoming clinical data, regulatory decisions, and commercial launches are key drivers for the sector.

• Biosimilars and Market Competition:

  • Biosimilars are expected to provide stable valuation floors and long-term growth optionality.
  • Competition from emerging therapies (e.g., gene therapy, emicizumab) may affect long-term growth.

• Upcoming Events:

  • ABBV/NBIX readout in uterine fibroids.
  • PEPITES topline data for DBVT.
  • Potential updates on the '1210 program for ALXN.
  • Pivotal studies for NEOD001 and PRX002 for PRTA.
  • Launch of Ingrezza in TD and ph2b trial for pediatric Tourette syndrome for NBIX.

Summary

The biotechnology sector in 3Q17 is expected to remain strong, with key companies such as Gilead and Biogen showing positive momentum. The report highlights the importance of upcoming clinical data, regulatory decisions, and strategic updates in shaping the sector's future performance. While the momentum is largely driven by sentiment and multiple expansion, the sustainability of this growth will depend on the actual results and the ability of companies to navigate competitive and regulatory challenges. The overall outlook remains favorable for the majority of the covered companies, with a risk/reward skew that supports continued investment in the sector.