Cantor Fitzgerald 26 maart 2019
Op analyst draadje staat de uitgebreide versie
Intraday Price, Overweight, Target: $130.00)
Bird Watching: What to look for in FINCH 1 & 3
Company Update
Investment Summary. Reiterate OW and $130 PT. FINCH 1 & 3 Ph3 filgotinib data, expected any day now, is an important catalyst for GLPG and partner GILD (Young, OW). Our thoughts on what to look for. The first filgotinib Ph3 study, FINCH 2, read out in Sept. '18 and in our view suggested that filgotinib may have a best in class risk-benefit profile among the JAK inhibitors. In the data from the FINCH 1 & 3 studies (guided for 1Q19), we think investors will be focused on 1) how efficacy compares to other agents, most notably upadacitinib (ABBV, not-covered), 2) safety events such as thrombotic events/infections vs. placebo.
For our detailed RA trial comp. charts, see our prep pack attached or ask us for our excel.
FINCH 1 (head-to-head study versus Humira) an ACR20 benefit over Humira of 8%+ would be competitive with upadacitinib on ACR20 in this population. In MTX-refractory patients, upadacitinib at week 24 (SELECT-COMPARE) showed an 8%, 16% and 12% benefit over Humira on ACR20, ACR50 and ACR70 scores, respectively. We think this will be the study FINCH 1 will be most closely compared to, with the typical caveats/limitations of cross-trial comparisons.
FINCH 3 (Monotherapy study) an ACR20 benefit over MTX of 20% would be competitive with upadacitinib in this population. In MTX- naive patients, upadacitinib (at the filed 15mg dose) at week 24 showed a 20%, 27% and 26% benefit over MTX on ACR20, ACR50 and ACR70, respectively, at the 15mg dose (SELECT-EARLY).
Safety: We are looking for low or minimal thrombotic events or serious/opportunistic infections vs. placebo. There were no thrombotic events (DVT, PE) on either placebo or active filgotinib arms in FINCH 2. FINCH 1 & 3 are much larger studies (~3,000 patients in total vs. ~350 in FINCH 2) and so we expect to see more events. Our key focus will be whether there is any imbalance vs. placebo.
Stock Move: Expectations are high into this data after FINCH 2 set a high bar, but we think the stock could trade up 10-15% on strong efficacy/safety, especially if differentiated from upadacitinib. On the downside, we think a complete failure is unlikely so we see 20-25% downside if data were more mixed or much weaker than upadacitinib. If these studies were a complete failure (highly unlikely), the stock could trade down ~40-50%. Company has ~25% of its value in cash, which provides support.
Data Timing:We have been getting questions around why the data has not yet been released. Our guess that these are very complicated data sets to analyze (~3k patients vs. ~350 in FINCH 2) and our guess is the regulators may have requested various statistical analyses, which take time.
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