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Acceleron Pharma Investor Meeting From UBS today.... Acceleron Pharma Inc Highlights from Investor Meetings with Management Luspatercept: Focus on ASH, While Commercial Dynamics Get More Attention We hosted a series of investor meetings with Acceleron management yesterday, including CEO Habib Dable and CBO John Quisel. Investors still remain acutely focused on quantification of transfusion-independence rates (RBC-TI) in MEDALIST ahead of ASH; management commentary remains consistent with messaging coming after the initial press release – with the key evolving nuance being recent positive shifts in Celgene's characterization of luspatercept peak sales potential ($2B+ risk-adjusted just in MDS and B-thal). The company messaged that KOLs would find a 30% RBC-TI in MEDALIST as a clear win; we think data will come in roughly between that level and the 39% RBC-TI rate seen in the phase 2. That said, we still see HI-E rates and the percent of patients achieving a >1g/dL increase in hemoglobin as more appropriate and practical measures of clinical benefit. From a commercial perspective, investors are increasingly appreciating (1) multi-year duration as an upside driver, and (2) the existing prevalence pool providing a source of patients at launch. ACE-083: Finding Validation from Peers Near term, we will be getting full part 1 FSHD data at World Muscle (Oct 2-6), though more importantly, strength and function data in both FSHD and CMT won't come until 2H19. While this program remains outside of Street models (and as such a potential upside driver), Regeneron and Biogen essentially following Acceleron's myostatin+ approach is highly validating, in our view. Sotatercept: Back to School for Education Coming Soon Acceleron will be hosting an R&D Day in November (final date hasn't been announced yet) that will be focused on PAH. In addition the company will be presenting incremental data at AHA in November. Data from a PAH study with exploratory endpoints is likely to read-out in 1H20, aligning with the timing of the phase 2 data. Valuation: Buy with $62 price target Our $62 price target is driven by our NPV sum-of-the-parts (SOTP) analysis, including luspatercept (~$56/sh) and ~$6/sh in net cash. |
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