We are maintaining our Neutral recommendation on Incyte Corporation (INCY) with a target price of $18.00.
Incyte is a Wilmington, Delaware-based drug discovery and development company with a focus on oral compounds to treat HIV, inflammation and cancer. The company's lead compound is INCB18424, an oral janus-associated kinase (JAK) antagonist.
Incyte is currently seeking US approval of INCB18424 for treating patients suffering from myelofibrosis (MF), a rare bone marrow disorder. Incyte submitted a new drug application (NDA) to the US Food and Drug Administration (FDA) for INCB424 earlier in the month.
The company expects to launch INCB18424 for MF in the US later this year (assuming that the FDA reviews the application on a priority basis). We believe that if INCB 18424 is approved and subsequently marketed successfully for MF then it will be a path-breaking achievement for Incyte. Partner Novartis (NVS) intends to seek European approval for INCB18424 for MF shortly.
Incyte is studying INCB18424 for other indications also such as psoriasis, polycythemia vera and essential thrombocythemia. Apart from INCB18424, Incyte has other candidates in its pipeline. We are impressed by the efforts made by Incyte to develop its pipeline.
We are also impressed by its collaborations with big pharma players such as Pfizer (PFE), Novartis and Eli Lilly (LLY). We believe the association of big pharmaceutical companies will bolster the company with much needed financial strength and experience.
Even though INCB18424 has been filed in the US for MF, most of the other pipeline candidates are several years away from hitting the market. The debt burden of the company is another area of concern.
We prefer to remain on the sidelines until further visibility is obtained on the pipeline development at Incyte and retain our Neutral view on the stock.
INCYTE CORP (INCY): Free Stock Analysis Report
LILLY ELI & CO (LLY): Free Stock Analysis Report
NOVARTIS AG-ADR (NVS): Free Stock Analysis Report
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