Wedbush Cuts TESARO Target By 18% Following SOLO-2 Results

Following the SOLO-2 trial results surpassing expectations, Wedbush’s David Nierengarten stated that the data demonstrated “similar top-line efficacy for Lynparza as that achieved by niraparib in the NOVA study.”

The analyst reiterated an Outperform rating on TESARO Inc (NASDAQ: TSRO), while lowering the price target from $200 to $164.

Market Share Expectations

“We see the investigator-assessed PFS (progression free survival) as the more relevant comparison given this more closely matches the NOVA study assessment protocol, but have reduced our market share expectations for niraparib in the gBRCA setting to account for expected competition,” Nierengarten mentioned.

At the same time, the analyst expects niraparib to gain competitive market share in the germline BRCA (Breast Cancer susceptibility gene) mutant (gBRCAmut) maintenance setting, given its first to market and dosing advantages.

Related Link: Clovis' Rubraca Vs. TESARO's Niraparibp

Safety Profile

In addition, Nierengarten mentioned that the safety profile for Lynparza was consistent with earlier studies, with 36.9 percent of patients experiencing adverse events of at or above Grade 3, as compared to 18.2 percent of the placebo treated group. The most commonly experienced adverse events included nausea, fatigue, anemia and vomiting.

“We have updated our model to account for increased expected competition from Lynparza in the gBRCAmut patient population, which accounts for approximately 35 percent of the ovarian cancer maintenance setting – we now believe niraparib can achieve a peak market share of 33 percent in the gBRCAmut setting,” the analyst said.

Niraparib is expected to retain its first mover advantage, while its clinical benefits in non-gBRCA patients would allow broader usage.

Stock Expectations

Nierengarten expects Tesaro’s shares to remain volatile leading up to the release of the ARIEL3 data.

“A similar result in that study will likely further erode estimated market share for niraparib and take out near-term acquisition expectations for TSRO,” the analyst noted.

Nierengarten expects Tesaro to ultimately be able to compete effectively, stating that shareholder would need to adopt a longer term view.