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On Monday, Leerink Partners maintained an Outperform rating on Arvinas Inc. (NASDAQ:ARVN) but reduced the price target from $62.00 to $49.00. The adjustment follows anticipation of the VERITAC-2 trial results for vepdegestrant (vepdeg) in metastatic breast cancer treatment. Currently trading at $17.61, the stock has indeed fallen about 62% over the past year, according to InvestingPro data. Despite this decline, analysts maintain a strong consensus recommendation of 1.45 (Strong Buy), with price targets ranging from $28 to $110, suggesting significant potential upside.
The VERITAC-2 trial is a critical evaluation of vepdeg, an estrogen receptor (ER) degrader, in the second line (2L+) hormone receptor-positive, HER2-negative metastatic breast cancer. The Phase 3 trial will measure the effectiveness of vepdeg against fulvestrant in patients who have the resistance mutation ESR1 (ESR1m) and in a broader intent-to-treat (ITT (NYSE:ITT)) population, which includes both ESR1m and ESR1 wild-type (WT) patients. With a market capitalization of $1.2 billion and strong liquidity position - as evidenced by a current ratio of 4.17 - Arvinas appears well-positioned to advance its clinical programs.
Leerink Partners’ analysis suggests that the success of vepdeg in the ITT population could lead to a broad label for the drug, not limited to ESR1m patients. The firm projects potential unadjusted peak worldwide revenues of approximately $1.2 billion for the 2L+ opportunity should vepdeg receive such a broad label. Additionally, Leerink forecasts roughly $1.67 billion in unadjusted revenues worldwide for the first line (1L) treatment setting, where ESR1 mutations are less common. While current revenue stands at $161.1 million, InvestingPro analysts anticipate significant sales growth of 224% for the current year. For deeper insights into Arvinas’s growth potential and comprehensive financial analysis, investors can access the detailed Pro Research Report available on InvestingPro.
Analysts highlight that while other selective estrogen receptor degraders (SERDs) have shown benefits over standard of care in ESR1m patients, they have not demonstrated the same in the ITT populations. This suggests limited activity in ESR1 WT patients. Leerink posits that PROTACs like vepdeg could exhibit superior activity across different patient populations due to a more potent and sustained mechanism of ER degradation.
The firm concludes that if the VERITAC-2 trial shows vepdeg to have best-in-class activity in both ESR1m and ITT populations, Arvinas Inc. shares could appreciate significantly, potentially up to 200%.
In other recent news, Arvinas Inc. has experienced significant developments in its business operations and clinical trials. The biopharmaceutical company has terminated a lease agreement with Science Park Development Corporation, effectively releasing it from future financial liabilities associated with the lease. Arvinas also announced plans for two Phase 3 combination trials for vepdegestrant, a drug for treating breast cancer, in collaboration with Pfizer (NYSE:PFE). However, a key clinical trial for vepdegestrant has been delayed, potentially affecting regulatory submissions and commercialization timelines.
In addition to these developments, Arvinas has expanded its New Haven premises until 2029, reflecting an enhancement in its infrastructure and operational capacity. The company has also made changes to its executive team, with Andrew Saik appointed as the new CFO, Ian Taylor promoted to President of Research and Development, and Angela Cacace assuming the role of Chief Scientific Officer.
Analysts from BMO Capital Markets, Leerink Partners, Oppenheimer, and Stifel have adjusted their price targets for Arvinas, despite the delay in the clinical trial. BMO Capital Markets maintained its Outperform rating but slightly lowered its price target from $90.00 to $88.00. These recent developments reflect the evolving dynamics of Arvinas Inc. as it continues to advance its clinical programs and adapt to changing circumstances.
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