Apellis Pharmaceuticals APLS is allegedly drawing takeover interest from pharma bigwigs according to a recent Bloomberg article, based on information from people with knowledge of the matter. The article claims that the company has been holding discussions with its advisors to evaluate its options for a possible takeover. The article further states that Apellis might also be looking for partnerships or licensing agreements for some of its ophthalmology products.
In the absence of concrete proof or a statement from Apellis, there is no guarantee of a takeover and it remains a speculation on the part of Bloomberg. Deliberations on the matter are reportedly ongoing. According to Bloomberg’s sources, the company prefers to stay independent for the time being. Management of Apellis has not commented on the matter yet.
However, we believe that the company forms a lucrative acquisition option for larger pharma companies. Larger pharma companies often choose to acquire smaller companies with marketed products to generate incremental sources of revenues that reduce the burden on their blockbuster drugs. Acquisitions also help these companies to mitigate the effects of patent expirations of their drugs.
Shares of Apellis have outperformed the industry. In the past year, shares of Apellis have risen 13% against the industry’s 16.5% decline.
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The company currently has two approved products in its pipeline, Empaveli and Syfovre. Apellis received FDA approval for its targeted C3 therapy, Empaveli, as a monotherapy treatment for adult patients suffering from PNH, a rare blood disorder, in May 2021. This marked the first FDA nod to the company for any of its products. Empaveli is also approved in European Union for the same indication.
In February 2023, the FDA approved Apellis’ second drug, Syfovre (pegcetacoplan injection). It is the first and only treatment for geographic atrophy (GA) secondary to age-related macular degeneration. In December 2022, Apellis also submitted a marketing authorization application to the European Medicines Agency (EMA) for intravitreal pegcetacoplan to treat GA. The application is currently under review by the EMA with a decision expected in early 2024. The company launched Syfovre in the United States beginning this March.
Several label-expanding studies for Empaveli are also currently underway in partnership with Sobi.
On the other hand, a possible acquisition of Apellis by a larger pharma company would provide the former access to significantly larger resources and infrastructure for the marketing and distribution of Syfovre to U.S. patients. The influx of cash would also boost the research and development activities for the candidates currently in Apellis’ pipeline.
Apellis is prone to competition in the market from a smaller pharma company, IVERIC Bio ISEE. In September 2022, IVERIC announced positive top-line data from the second phase III GATHER2 study evaluating its investigational complement C5 inhibitor, Zimura for the treatment of GA, which is the same indication as Apellis’ Syfovre.
IVERIC also evaluated Zimura in another pivotal study – GATHER1 – its first phase III study on Zimura in GA. Based on the results of these two studies, IVERIC filed an NDA with the FDA for Zimura in December 2022. A decision on the application from the FDA is due in August 2023. A possible approval will provide direct competition to Syfovre.
Apellis Pharmaceuticals, Inc. Price and Consensus
Apellis Pharmaceuticals, Inc. price-consensus-chart | Apellis Pharmaceuticals, Inc. Quote
Zacks Rank and Stocks to Consider
Apellis Pharmaceuticals currently has a Zacks Rank #3 (Hold).
A couple of top-ranked stocks in the same industry are Aptinyx APTX and ADMA Biologics ADMA, both carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In the past 90 days, the Zacks Consensus Estimate for Aptinyx’s 2023 loss per share has narrowed from 77 cents to 56 cents. In the past year, shares of Aptinyx have fallen by 94.2%.
APTX beat estimates in each of the trailing four quarters, delivering an average earnings surprise of 9.53%.
In the past 90 days, the consensus estimate for ADMA’s 2023 loss per share has narrowed from 20 cents to 14 cents. In the past year, shares of ADMA have increased by 66.4%.
ADMA beat estimates in three out of the trailing four quarters, delivering an average earnings surprise of 2.88%.
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