Investing.com — Shares of Apellis Pharmaceuticals (NASDAQ: ) fell 8.9% in premarket trading following news that the FDA accepted a revised supplemental application from rival Astellas Pharma for its eye drug, which could lead to an earlier-than-expected approval.
The review led to a reassessment of the market outlook for Apellis’ eye drug, Syfovre, according to Jefferies.
The move comes as a blow to Apellis, with Jefferies indicating that Syfovre’s bull case is waning. The market had previously reacted positively to Apellis’ prospects after the FDA issued a comprehensive response letter to Astellas, but this sentiment has been challenged by recent developments.
RBC Capital Markets echoed this sentiment, suggesting that the expected benefit of its own-label dosage form of Syfovre may no longer be competitive. Lisa Walter from RBC Capital Markets, who has a sector rating and a price target of $26, emphasized the negative impact on Apellis shares, which received a boost from the FDA’s initial response to Astellas.
Despite the setback, Jefferies analyst Akash Tewari, who maintains a buy rating with a $33 price target, noted that there could still be near-term upside for Syfovre. This optimism is based on certain Medicare Advantage plans favoring Syfovre over Astellas’ Izervay.
Piper Sandler’s Biren Amin offered more insight, saying the FDA’s decision to reclassify as a Class 1 resubmission suggests only minor changes were made to Astellas’ application. Amin’s comments highlight that Izervay may be on the fast track to expanding the label and lifting the 1-year use limit, which could intensify competition in the eye drug market.
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