Dynavax Technologies Corporation (NASDAQ: DVAX) is awaiting its tryst with the FDA after a failed attempt in August. Against this backdrop, analyst Cathy Reese of Empire Asset Management Company recommended buying the shares of the company ahead of the November PDUFA date.
As such, the firm has a Buy rating and a $38 price target on the shares of Dynavax.
Hepatitis B Vaccine Hits Roadblock
Dynavax shares slid close to 8 percent on Aug. 10, when the company announced that the FDA has requested more detailed information on its proposed post-marketing study of Heplisav-B, a Hepatitis B vaccine, based on a feedback received from the FDA's FDA's Vaccines and Related Biological Products Advisory Committee.
The committee had voted 12 to 1 to support licensure. The company then expected the new PDUFA action date to be postponed to no later than Nov. 10, 2017, as the response to the information request will trigger a major amendment to the BLA. Despite the setback, the company said it continues to target an early 2018 U.S. commercial launch.
Apparently mollified by the statement from the company, its shares rebounded, hitting a multi-month high of $21.15 on Monday, with the level marking the highest since late April 2016. However, the stock fell 4.49 percent to $20.20 on Tuesday.
Positive Expectations For November PDUFA Date
Reese expressed confidence in Heplisav B's Nov. 9 PDUFA date yielding positive results. Nevertheless, the analyst noted that as the date approaches, speculation concerning the company's ability to market this vaccine has increased. Although impressed by investors' confidence in Heplisav-B's approvability, Empire Asset Management Company said it is disappointed over the skepticism surrounding the company's ability to market the vaccine.
Pricing The Key
The firm clarified that vaccines are generally marketed differently from pharmaceuticals and biologics, with the WHO indicating that the vaccine market is relatively small and concentrated on both supply and demand sides, relative to pharmaceuticals.
The vaccine market is highly regulated and largely dependent on public purchasers and donor policies, the firm added.
Stating that there are numerous distribution models for vaccines, the firm said it believes a partner that can sell Heplisav-B vaccine with other vaccines should be useful in Dynavax's market penetration.
"We do not believe that market influencing physicians will be particularly useful for Heplisav-B's success due to this vaccine's obvious dosing advantage and abundance of clinical data," the firm said. Therefore, the firm feels making the vaccine available at acceptable pricing should help to initially gain acceptable market share.
However, the firm is of the view additional commercialization efforts may be needed to benefit from sales growth in special populations such as diabetes. That said, the firm believes the most benefit for these sales are from support groups involved with these patient population.
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Latest Ratings for DVAX
|Jul 2017||RBC Capital||Upgrades||Sector Perform||Outperform|
|Apr 2016||RBC Capital||Downgrades||Outperform||Sector Perform|
|Apr 2016||JP Morgan||Downgrades||Overweight||Neutral|
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