Vertex Pharmaceuticals reported "solid" Q2 results that set up for an "exciting 2020 story," Jefferies analyst Michael Yee tells investors in a post-earnings research note. He believes the earnings update on cystic fibrosis, the eventual triple launch, and all the new "2020 pipeline optionality" should drive "attractive upside to the stock" following the recent pullback. The analyst sees potential upside of 25%-50% and keeps a Buy rating on Vertex with a $210 price target.

Novartis (NVS) presented results from a pre-specified interim analysis of the Phase 3 APPLAUSE-IgAN study of Fabhalta, an investigational Factor B inhibitor of the alternative complement pathway, in patients with IgA nephropathy, or IgAN. In the analysis, patients treated with Fabhalta achieved a 38.3% proteinuria reduction as measured by 24-hour urine protein to creatinine ratio at 9 months when compared to placebo on top of supportive care. This pre-specified interim analysis included 250 patients for the efficacy analysis and 443 for the safety analysis1. The APPLAUSE-IgAN study continues in a double-blind fashion, and therefore only limited interim analysis results can be presented. Submission for possible accelerated approval to the FDA was accepted and has received priority review. The primary endpoint evaluating Fabhalta's ability to slow IgAN progression by measuring the annualized total estimated glomerular filtration rate slope over 24 months is expected at study completion in 2025, Novartis stated. "IgAN progresses over many years, and patients' needs may evolve such that different therapies may be best used at different times. Our renal pipeline includes medicines with a variety of mechanisms which may allow them to be targeted to patients based on their clinical characteristics," added David Soergel, M.D., Global Head, Cardiovascular, Renal and Metabolism Development Unit, Novartis. Recently, after Alpine Immune Sciences (ALPN) and Vertex Pharmaceuticals (VRTX) announced that the companies entered into a definitive agreement under which Vertex will acquire Alpine for $65 per share, or $4.9B in cash, Evercore ISI analyst said the B cell modulator space within IgAN is "hot," with Alpine marking the second acquisition in the class in the last 10 months. The analyst, who sees Alpine trailing Otsuka, Vera Therapeutics (VERA) and Novartis by about one to two years, argued that with Alpine off the market, Vera is now "the only free-standing B cell modulator in the IgAN space."