Gilead downgraded at BMO on upcoming readout for breast cancer therapy
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Gilead Sciences (GILD
-1.8%) has lost more than 15% in the year so far. However, the selloff is no reason for analysts at BMO Capital Markets to become bullish on the stock.
The firm downgraded Gilead (NASDAQ:GILD) to Market Perform from Outperform on Monday with a cautious view on the companyâs oncology business led by Trodelvy injection for cancer.
Revising his view on TROPiCS-02 Phase 3 trial for the treatment in HR-positive, HER2-negative breast cancer, the analyst Evan David Seigerman argues that its upcoming Q1 2022 readout could signal âa base-case of a statistically significant, but not clinically meaningful PFSâ outcome.
Despite the expectations of a positive PFS benefit, Seigerman does not think âit will be enough to warrant widespread clinical useâ for Trodelvy. The price target cut to $65 from $75 per share implies a premium of only ~6% to the last close.
Even though Gilead (GILD) trades at a discount to large-cap peers, the analyst looks for further de-risking in the companyâs oncology franchise and calls its âearlier-stage pipeline assets and collaborations as a "show me" story.â
Trodelvy is authorized in the U.S. for locally advanced or metastatic triple-negative breast cancer in addition to its indication in urothelial carcinoma. The treatment generated $380M for the company in 2021, up from $49M in the prior year.