Prothena stock catapulted Thursday — and flashed a bullish sign — after the company's Roche-partnered Parkinson's treatment showed promise in a midstage study.
Roche tested prasinezumab over 18 months in patients with early-stage Parkinson's disease. Technically speaking, the drug missed the primary goal of the study. But patients who received prasinezumab showed a delay in motor worsening. The benefit was even more pronounced in patients receiving levodopa, the standard treatment for Parkinson's.
This suggests "another study, with a patient population enriched for levodopa use, could enable a future trial to succeed and prasi to find a role considering recent failures from other competitors," RBC Capital Markets analyst Brian Abrahams said in a report.
Prothena stock surged 34%, closing at 16.01. That pushed shares above their 50-day moving average for the first time since late September, according to MarketSurge. Roche stock, though, fell more than 2% to 34.17.
Prothena Stock Rebounds
Signs of activity from prasinezumab "justify some stock rebound," Abrahams said.
Under the terms of the deal with Roche, Prothena is eligible to receive high single-digit to high double-digit royalties on sales of prasinezumab. Evercore ISI analyst Michael DiFiore estimates a peak of $275 million in royalties to Prothena.
But Abrahams kept his sector perform rating on Prothena stock.
"Further fracturing the total addressable population may limit peak sales (opportunity) — which may already be capped by the somewhat modest efficacy and (intravenous) administration requirement — even further, though the remaining unmet need in PD still suggests some (opportunity)," he said.
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