Biogen is likely to get a big boost from its increased focus on developing drugs for kidney transplant patients and individuals suffering from autoimmune diseases such as lupus, according to Wells Fargo. The bank’s research arm raised its rating on the stock to overweight from equal weight. It also upped its price target on shares to $250 from $200, implying roughly 41% upside from Friday’s close. “Our positive view comes from new medium-term growth drivers in BIIB’s late-stage pipeline outside [development of therapies in neurology],” analyst Mohit Bansal said in a note to clients. “New [revenue] streams from immunology/kidney pipelines [will] reduce reliance on [neurology treatments].” Biogen has shifted its focus to its pipeline of late-stage products, including therapies for lupus and antibody-medicated rejection (AMR) treatments for kidney transplant patients, according to Wells Fargo. The pivot comes amid rising competition in the multiple sclerosis (MS) drug market. The analyst estimates Biogen will clock roughly $2.5 billion in adjusted sales from its lupus and AMR offerings by 2035. That should “more than offset” the erosion in sales seen by its MS drugs, according to Wells Fargo. “We are bullish on … important immunology/kidney catalysts in the next ~12-18 mo,” Bansal wrote, pointing to promising data from trials for Biogen’s investigative drugs such as litifilimab, felzartamab and dapirolizumab. “These assets w/differentiated mechanisms and already de-risked by compelling datasets [are] setting up large and currently underappreciated” opportunities, the analyst added. Wells Fargo’s call goes against consensus on the Street. Of the 37 analysts covering Biogen, just 17 have a buy or strong buy on the stock, LSEG data shows. Shares have ticked up nearly 1% in the year to date, underperforming the overall market.
