Leerink Partners upgrades Halozyme stock to Market Perform on lower Medicare exposure

Investing.com - Leerink Partners upgraded Halozyme Therapeutics (NASDAQ:HALO) from Underperform to Market Perform on Tuesday, maintaining its price target of $70.00. The company, which boasts a perfect Piotroski Score of 9 according to InvestingPro data, has demonstrated robust financial health with a "GREAT" overall rating and impressive 35% revenue growth over the last twelve months.

The upgrade follows Halozyme’s release of a new slide deck that revealed only 20% of its ENHANZE partnered product global sales will come from Medicare Part B, which was lower than the research firm had previously feared.

Halozyme also quantified the cost savings and value of subcutaneous products compared to branded intravenous product spending in its presentation, providing additional support for the company’s business model.

Leerink Partners noted that uncertainty remains for 2029 and beyond regarding products like Opdivo that will face IV biosimilar competition, specifically questioning how payers might shift volume to lower-cost biosimilar IV products despite their inferiority to subcutaneous formulations.

The research firm’s decision to maintain its $70 price target while upgrading the rating reflects its reassessment of Halozyme’s Medicare Part B exposure risk, which appears less significant than previously estimated.

In other recent news, Halozyme Therapeutics has reported several significant developments. The company announced its intention to acquire Elektrofi, Inc. for $750 million, with additional milestone payments of up to $150 million contingent on regulatory approvals. This acquisition aims to enhance Halozyme’s drug delivery technology and is expected to close in the fourth quarter of 2025. In another development, H.C. Wainwright raised its price target for Halozyme to $90, maintaining a Buy rating, while Leerink Partners increased its target to $70, though keeping an Underperform rating, citing the strategic nature of the Elektrofi acquisition.

Additionally, Halozyme issued a statement regarding the final IPAY 2028 guidance for Medicare price negotiations, highlighting long-term projections for U.S. Medicare Part B spending. The company also announced the appointment of Cortney Caudill as Senior Vice President and Chief Operating Officer, effective immediately. Caudill brings extensive experience from her previous roles at Aeglea Biotherapeutics and other biotech firms. These developments reflect Halozyme’s ongoing strategic initiatives in both leadership and technological advancements.

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