Raytheon awarded $71 million in Navy contracts for missile systems
COPENHAGEN - Ascendis Pharma A/S (NASDAQ:ASND) has entered into a royalty agreement with Royalty Pharma plc (NASDAQ:RPRX) for its U.S. sales of YORVIPATH, the companies announced today. Ascendis will receive an upfront payment of $150 million in return for a 3% royalty on the U.S. net sales of the drug, which is the first and only FDA-approved treatment for hypoparathyroidism in adults.
The synthetic royalty funding agreement is capped, with royalty payments ceasing once they reach a multiple of 2.0x, or 1.65x if the royalties amount to that figure by December 31, 2029. Ascendis Pharma's CEO, Jan Mikkelsen, expressed that the deal underscores the value of YORVIPATH and aligns with the company's goal to reduce capital costs while retaining the flexibility to bolster its global commercial capabilities.
Royalty Pharma's CEO, Pablo Legorreta, also commented on the partnership, noting the significance of YORVIPATH as a treatment for the underlying cause of hypoparathyroidism in adults. This agreement marks the second collaboration between the two companies, highlighting Royalty Pharma's commitment to creating funding solutions that benefit both parties.
Evercore served as the financial advisor to Ascendis for the transaction, with Latham & Watkins and Mazanti-Andersen providing legal counsel. Royalty Pharma received legal advice from Goodwin Procter and Fenwick & West.
Ascendis Pharma, based in Copenhagen with additional facilities in Europe and the United States, is known for its TransCon technology platform, which it uses to develop new therapies. Royalty Pharma, established in 1996, is recognized as a significant financier in the biopharmaceutical industry, holding a portfolio of royalties on over 35 commercial products.
The information for this article is based on a press release statement.
In other recent news, Ascendis Pharma's drug YORVIPATH® received approval from the U.S. Food and Drug Administration (FDA) for the treatment of hypoparathyroidism in adults. Following this development, JPMorgan raised its price target for Ascendis Pharma to $174, maintaining an Overweight rating. The firm also set its total revenue expectations for Ascendis Pharma at €80 million, slightly below the Bloomberg consensus.
Goldman Sachs also followed suit, raising its price target for Ascendis to $195, while keeping a Buy rating. The firm remains positive about Yorvipath's market potential, forecasting peak sales of EUR 1.6 billion.
TD Cowen upgraded Ascendis Pharma's stock rating from Hold to Buy, with an increase in the price target to $175, based on positive expectations for the upcoming launch of a drug candidate. Stifel initiated coverage on Ascendis Pharma with a Buy rating and a $200 price target.
BofA Securities maintained a Buy rating on shares of Ascendis Pharma with a steady price target of $165.00. The firm's reiteration of the Buy rating and the price target reflects an optimistic outlook for Ascendis Pharma as the market awaits further updates on the TransCon PTH review process.
These are the recent developments for Ascendis Pharma, a company that continues to make significant strides in the medical field.
InvestingPro Insights
As Ascendis Pharma A/S (NASDAQ:ASND) secures a royalty agreement to advance its financial strategy, examining the company's financial health and market performance offers valuable context. According to recent InvestingPro data, Ascendis has a market capitalization of $7.94 billion, reflecting its scale within the biopharmaceutical sector. Despite the company's significant revenue growth over the last twelve months, with an impressive increase of 322.18%, Ascendis is not expected to be profitable this year, as analysts suggest. The company's gross profit margin stands at a robust 85.61%, indicating efficient management of production costs relative to revenue.
InvestingPro Tips highlight a couple of key considerations for investors interested in Ascendis. First, the company's short-term obligations currently exceed its liquid assets, suggesting potential liquidity challenges. Additionally, Ascendis operates with a moderate level of debt, which could impact its financial flexibility. It's also notable that Ascendis does not pay a dividend, which might influence investment decisions for those seeking regular income streams from their holdings.
For those looking to delve deeper into Ascendis Pharma's financial nuances, InvestingPro offers additional insights. Currently, there are six more InvestingPro Tips available that could further inform investment strategies. These tips, along with a comprehensive analysis, can be found on the dedicated InvestingPro page for Ascendis Pharma: https://www.investing.com/pro/ASND.
The company's stock performance also warrants attention, with a 1-year price total return of 40.89%, showcasing a strong medium-term growth trajectory. However, the stock is trading at 83.65% of its 52-week high, which may indicate room for potential growth or a reassessment of its market position. Ascendis's fair value as assessed by analysts is $186.12, while InvestingPro's fair value estimation stands at $135.11, offering different perspectives on the stock's valuation.
As Ascendis Pharma continues to navigate the biopharmaceutical landscape, these financial metrics and expert tips from InvestingPro could be instrumental for investors in making informed decisions about their interest in the company.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.