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Analyst Recommendations for Vertex Pharmaceuticals in October

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Guidance for fiscal 2017

After 3Q17, Vertex Pharmaceuticals (VRTX) increased its guidance for cystic fibrosis product revenues, from $1.87 billion–$2.1 billion to $2.10 billion–$2.15 billion. Vertex Pharmaceuticals expects Orkambi and Kaydeco to generate net revenues of $1.29 billion–$1.32 billion and $810.0 million–$830.0 million, respectively, in fiscal 2017.

Previously, Vertex Pharmaceuticals estimated Orkambi’s net revenues to be $1.1 billion–$1.29 billion in fiscal 2017. Increasing demand for Orkambi in the United States among CF (cystic fibrosis) patients aged six years and older and revenue estimates from countries where Orkambi is presently reimbursed primarily led Vertex Pharmaceuticals to increase its revenue guidance for the drug.

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Vertex Pharmaceuticals had previously estimated that Kalydeco’s revenues would be $810.0million–$830.0 million. The FDA’s (U.S. Food & Drug Administration’s) approval for a label expansion for Kalydeco in August 2017 for use in CF patients with one of five residual function mutations that manifest to a defect in the CFTR (cystic fibrosis transmembrane conductance regulator) gene led to a rapid uptake of the drug. The increasing uptake after approval of the drug led Vertex Pharmaceuticals to update its revenue guidance for Kalydeco.

Analysts’ recommendations

Of the 27 analysts covering Vertex Pharmaceuticals in October 2017, ~81.0% of them have recommended some form of a “buy” rating, while none of them have recommended any form of a “sell.”

On October 25, 2017, Vertex Pharmaceuticals had a consensus 12-month target price of $179.56, which represents a 22.3% return on investment over the next 12 months. The Health Care Select Sector SPDR ETF (XLV) invests ~1.1% of its total portfolio holdings in Vertex Pharmaceuticals.

Peer ratings

Of the 26 analysts tracking Regeneron Pharmaceuticals (REGN) in October 2017, ~50.0% of them have recommended some form of a “buy” rating. On October 26, 2017, REGN had a consensus 12-month target price of $496.30, which represents a ~19.3% return on investment over the next 12 months.

Of the 28 analysts tracking Gilead Sciences (GILD) in October 2017, ~50.0% of them have recommended some form of a “buy” rating. On October 26, 2017, GILD had a consensus 12-month target price of $84.76, which represents an ~8.8% return on investment over the next 12 months.

Of the 24 analysts tracking BioMarin Pharmaceutical (BMRN) in October 2017, ~79.0% of them have recommended some form of a “buy” rating. On October 23, 2017, BMRN had a consensus 12-month target price of $112.95, which represents a ~36.9% return on investment over the next 12 months.

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