In an October 28 research note, Wedbush Securities Inc. Analysts David Nierengarten, Ph.D., and Dennis Pak advised that global precision therapy company Blueprint Medicines Corp. (BPMC:NASDAQ), which is focused on the invention of life-changing therapies for treatment of cancer and hematologic disorders, recently reported Q3/21 financial results and raised it FY/21 revenue guidance to $170-180 million.
The analysts highlighted that total net sales of AYVAKIT for use in treatment of both advanced systemic mastocytosis (aSM) and gastrointestinal stromal tumor (GIST) had exceeded Wedbush's prior forecasts. The research firm stated that though Blueprint Medicines did not specify the exact contribution from aSM sales to overall revenues, the firm's management suggested that the majority of sales growth came from AYVAKIT for aSM, which Wedbush said makes sense when considering the relative sizes of the two addressable markets.
Wedbush commented that for the first full quarter since AYVAKIT was commercially launched in June 2021, individuals who received around two months of treatment for midostaurin1 in a real world, non-clinical setting, appear to be swiftly converting to AYVAKIT.
The analysts added that, "we are encouraged with the rapid uptake of AYVAKIT across academic and community centers with more than 100 new prescribers/accounts using AYVAKIT for the first time." Due to the rising levels of acceptance of AYVAKIT, the firm advised that it is adjusting its financial models upward to account for faster adoption of AYVAKIT in aSM treatment.
The report pointed out that there is further potential upside for AYVAKIT in treating patients afflicted with non-advanced SM. Blueline is reportedly now conducting a registrational PIONEER study and anticipates delivery of a data readout in mid-2022 along with possible subsequent regulatory submissions.
The analysts stated that "we continue to be buyers of Blueprint Medicines at these levels and look forward to additional sales data as it becomes available."
Wedbush indicated that in Q3/21, sales of GAVRETO, the company's other primary medicine, were in-line with its projections which estimated net end user revenues of $5.5 million.
The analysts wrote that the expected upcoming approval of GAVRETO as a first-line treatment for RET fusion-positive advanced NSCLC would be a very positive development as "it would make GAVRETO the first and only targeted treatment approved for this patient population in the EMA."
During Q3/21, the company posted total revenue of $24.2 million, compared to $745.1 million in Q3/20. The large decrease was due to significant reductions in collaboration revenue. The analysts noted that net product revenues in Q3/21 increased by 175% to $17.27 million, compared $6.31 million in Q3/20.
The report from Wedbush noted that Blueprint Medicines updated its revenue estimates and now expects FY/21 total revenue will be between $170 million and $180 million. Thus, by taking the midpoint of that range, it suggests that the company guidance implies that Q4/21 will come in at approximately $102 million. Wedbush wrote that the bulk of those revenues are anticipated to be derived from year-end milestone payments.
Wedbush commented that by year-end 2021, it anticipates Blueprint to initiate a planned Ph 1 trial of BLU-701 in EGFR-driven NSCLC and following that the firm is expected to proceed forward with a Ph 1 trial of BLU-852 (MAP4K1) in advanced cancers.
The analysts advised that in addition to the non-advanced SM data expected in mid-2022, it also sees several other likely positive catalysts for the firm for FY/22. The report listed that these include "receipt of preclinical data from the BLU-701 + BLU-945 combo in EGFR-driven NSCLC in early 2020 and enrollment of a first-in-human trial of BLU-222 (CDK2 inhibitor) in cyclin-E aberrant cancers in Q1/22."
The analysts wrote that with several new drug candidates in the development pipeline involved in ongoing clinical trials, 2022 looks to be a "news flow rich" year and noted that as sales of AYVAKIT now appear to be accelerating, the firm believes current share price levels present an attractive entry point.
Wedbush Securities stated it is reiterating its Outperform rating for Blueprint Medicines Corp. and is raising its 12-month price target for the company's shares from $132.00 to $136.00. The company's shares trade on the Nasdaq Exchange under the symbol BPMC and is trading at around $112.24/share.
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Disclosures from Wedbush Securities, Blueprint Medicines, October 28, 2021
Analyst Certification
We, David Nierengarten and Dennis Pak, certify that the views expressed in this report accurately reflect our personal opinions and that we have not and will not, directly or indirectly, receive compensation or other payments in connection with our specific recommendations or views contained in this report.
Company Specific Disclosures
1. WS makes a market in the securities of Blueprint Medicines.
7. WS expects to receive or intends to seek compensation for investment banking services from Blueprint Medicines in the next three
months.
This firm, Wedbush Securities, its officers, employees, and members of their families, or any one or more of them, and its discretionary and advisory accounts, may have a position in any security discussed herein or in related securities and may make, from time to time, purchases or sales thereof in the open market or otherwise.
Wedbush Securities does and seeks to do business with companies covered in its research reports. Thus, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.
