Neuren shares rally as Macquarie opens coverage with 'outperform' rating
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The news: Shares in Neuren Pharmaceuticals advanced in morning trade after Macquarie initiated coverage of the biopharmaceutical company with an 'outperform' rating.
The numbers: Neuren shares were up 2.8% to $13.21 at 11:45am AEST. Macquarie set Neuren's target price at $18.60.
The context: Macquarie analysts said Neuren offers a "rare, asymmetric risk-reward profile".
They noted that Neuren's strategic partnership with Acadia — which covers all commercialisation costs for its Rett syndrome medication Daybue — allows the company to take 10% to 15% royalty payments and "significant" milestone payments with minimal expenses.
The analysts also said that Daybue's expansion into other markets is "imminent", with Acadia anticipating approval by the European Medicines Agency early next year, triggering further royalty and milestone payments for Neuren.
The source: Macquarie research
