NewAmsterdam Pharma target raised to $45 on strong trial data

On Wednesday, Leerink Partners adjusted their outlook on NewAmsterdam Pharma Co NV (NASDAQ: NAMS), increasing the price target to $45 from the previous $42, while maintaining an Outperform rating on the stock. This decision follows the release of promising Phase 3 TANDEM trial results for the company's drug candidate, obicetrapib.

The TANDEM trial's top-line data has bolstered confidence in obicetrapib's unique clinical profile, especially after the successful Phase 3 BROOKLYN trial results earlier in July. The fixed-dose combination of obicetrapib and ezetimibe demonstrated a significant 48.6% reduction in LDL-C levels compared to placebo at day 84, aligning with management's expectations. Notably, the combination therapy also showed significant benefits over monotherapies of obicetrapib and ezetimibe, with over 70% of patients achieving LDL-C levels below 55mg/dL.

The safety profile of obicetrapib was reaffirmed in the Phase 3 trial, with a low 2.9% of drug-related treatment-emergent adverse events, comparable to the 3.9% observed in the placebo group. The discontinuation rate in the fixed-dose combination arm was also low at 1%, similar to placebo.

Looking forward, the TANDEM trial results are expected to positively influence the upcoming Phase 3 BROADWAY trial readout, anticipated in the fourth quarter of 2024. Management has hinted at potential placebo-adjusted LDL-C reductions in the range of approximately 36-40% for the BROADWAY trial.

In light of the recent trial successes, Leerink Partners has updated their model for NewAmsterdam Pharma, elevating the probability of success for obicetrapib from 80% to 85%. This revised assessment underpins the raised price target, reinforcing the Outperform rating for the company's shares.

In other recent news, NewAmsterdam Pharma Company N.V. reported positive results from its Phase 3 TANDEM clinical trial for a combination therapy designed to treat patients with cardiovascular disease. The trial demonstrated a significant reduction in low-density lipoprotein cholesterol (LDL-C) levels. Furthermore, NewAmsterdam has received continued support from Piper Sandler and TD Cowen, both maintaining positive ratings based on the company's promising clinical trial results.

Looking ahead, anticipation is building for the upcoming Phase 3 BROADWAY and TANDEM FDC (NS:FDC) study readouts, expected in the fourth quarter of 2024, which Piper Sandler predicts could significantly impact the company's trajectory. Moreover, the company is preparing for the Phase 3 HORIZON trial of pelacarsen in 2025. These are the recent developments for NewAmsterdam.

InvestingPro Insights

NewAmsterdam Pharma Co NV (NASDAQ: NAMS) has shown impressive market performance, with a strong year-to-date price total return of 112% and a one-year return of 149.26%. This aligns with the positive outlook from Leerink Partners and the promising Phase 3 trial results for obicetrapib.

InvestingPro data reveals that NAMS has a market capitalization of $1.85 billion, reflecting investor confidence in the company's potential. The company's revenue growth is particularly noteworthy, with a 78.77% increase over the last twelve months and a remarkable 889.83% growth in the most recent quarter.

However, investors should note that NAMS is currently not profitable, with an operating income margin of -548.12% for the last twelve months. This is not unusual for biotech companies in the development stage, as they often incur significant research and development expenses before generating substantial revenue.

Two relevant InvestingPro Tips for NAMS are:

1. The company holds more cash than debt on its balance sheet, which provides financial flexibility for continued drug development.

2. Liquid assets exceed short-term obligations, indicating a strong short-term financial position.

These tips are particularly relevant given the company's ongoing clinical trials and potential future commercialization efforts for obicetrapib.

For investors seeking a more comprehensive analysis, InvestingPro offers 10 additional tips for NAMS, providing a deeper understanding of the company's financial health and market position.

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