Vertex stock price target lowered to $405 by RBC on pain franchise setbacks

Investing.com - RBC Capital lowered its price target on Vertex Pharmaceuticals (NASDAQ:VRTX) to $405.00 from $430.00 on Tuesday, while maintaining a Sector Perform rating on the stock. The biotech giant, currently valued at $101 billion, is trading near its 52-week low of $377.85, with a high EBITDA multiple of 24.16x.

The price target reduction follows setbacks to Vertex’s pain franchise, including a limited chronic pain regulatory path and disappointing efficacy results for the company’s next-generation Nav1.8 ’993 therapy.

RBC Capital noted these developments will likely dampen market enthusiasm about Vertex’s ability to capture broader pain revenue opportunities, especially as the stock trades at a premium 24x multiple.

The investment firm estimates that Vertex’s pain franchise was receiving more than $25 billion in valuation, suggesting significant implications from these setbacks for the company’s overall market position.

Despite the challenges, RBC acknowledged that Vertex’s cystic fibrosis franchise continues to provide a "solid backbone with compelling margins, competitive positioning, and IP," though noted that launches of Alyftrek, Journavx, and Casgevy are unlikely to significantly impact financial results in the near term.

In other recent news, Vertex Pharmaceuticals reported its second-quarter 2025 earnings, surpassing analysts’ expectations with an earnings per share (EPS) of $4.52 compared to the forecasted $4.27. The company also exceeded revenue projections, reporting $2.96 billion against the anticipated $2.91 billion. These results highlight the company’s strong financial performance for the quarter. Additionally, Cantor Fitzgerald adjusted its price target for Vertex Pharmaceuticals to $485 from $535, maintaining an Overweight rating. This revision comes after disappointing clinical data from Vertex’s VX-993 bunionectomy trials and negative regulatory feedback on a potential broad peripheral neuropathic pain label for suzetrigine. Despite these setbacks, the Overweight rating suggests continued confidence in the company’s long-term potential. These developments provide investors with a mix of positive earnings results and challenges in Vertex’s clinical strategies.

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