JP Morgan thinks Keryx Biopharmaceuticals (NASDAQ:KERX)’s Zerenex can reach apex
In a report that was published on Wednesday, Cory Kasimov, a J.P. Morgan analyst initiated coverage on Keryx Biopharmaceuticals (NASDAQ:KERX) with an overweight rating and a $13 price target. It was stated in the report that J.P Morgan has initiated the KERX coverage based on the potential of its first-in-class, oral drug candidate used in the treatment of hyperphosphatemia, Zerenex, which is used in dialysis patients. Taking into consideration that it can also help in anemia treatment, JPM thinks that Zerenex ‘s pharmaco-economic advantages may lend impetus for rapid uptake in the extremely price-sensitive end stage renal disease market.
One of the reasons why KERX has been pulled down from recent peaks is because it is believed that the U.S. patent protection that it has is not sufficient. It is the company’s intellectual property (IP) position that has made few investors believe that it may not be able to gain enough marketing partnership for ZERENEX, or even for an outright company sale.
When intellectual property matters
These concerns are not just those that investors harbor. On its latest earnings call, the company noted that it is in discussions with various pharma companies about some potential strategic deals. This is an indication that Zerenex has attracted some interest and that there is also an expectation that it has market potential. As far as investors are concerned the company’s IP position is still a critical factor that can switch it from being in the $7 range to its previous almost $10 per share high. If Keryx Biopharmaceuticals (NASDAQ:KERX) is able to but the Zerenex IP issues to rest, the other pieces should fall in place. If its 2024, surface area formulation and dissolution patents hold up, that would be a sufficient amount of time to stave the generic sharks long enough to make the exclusivity of the drug magnetic enough to attract strategic partners.
What is IP?
Intellectual Property or IP is essentially a legal definition of inventions, ideas, commercially-viable products and also artistic works that are created out of a persons or a company’s mental and operational process. It is protected by various legal means such as patents, trademarks, copyrights and registrations.