Wells Fargo reduced its price target on Ultragenyx Pharmaceutical Inc. to $18 from $50 after the company’s Phase 3 ASPIRE trial evaluating GTX-102 failed to meet its primary endpoint and key secondary measures in Angelman syndrome. The trial showed no positive trends across subscales, prompting the bank to remove GTX-102 from its financial model.
The setback has raised concerns about the prospects for the AURORA trial, which includes patients with mutations and is now viewed as higher risk. Wells Fargo maintained an Overweight rating but sharply lowered its valuation, leaving the new target 32% below the stock’s closing price of $26.53.
JPMorgan, Baird, and Evercore ISI also downgraded the stock, with price targets reduced to $36, $16, and $16 respectively. JPMorgan shifted its rating to Neutral from Overweight, while Baird and Evercore ISI moved to Neutral and In Line from prior Outperform and Outperform ratings.
Ultragenyx reported negative free cash flow of $489 million over the last twelve months and an EBITDA loss of $465 million, with analysts not expecting profitability in the current year. The ASPIRE trial’s failure to achieve the Bayley-4 cognitive raw score primary endpoint and the Motor Developmental Rating Index secondary endpoint underscores the clinical and financial challenges facing the company’s lead program.
