NewAmsterdam Pharma ‘s latest drug treatment could lead investors to a windfall, according to RBC Capital Markets. The investment bank initiated coverage of the biopharmaceuticals firm with an outperform rating and $25 price target. That implies more than 270% potential upside compared with the stock’s close of $6.70 on Friday. Shares of NewAmsterdam are down nearly 37% since the start of the year. But analyst Leonid Timashev believes that investors may not be giving the company – and its product lineup – enough credit. NAMS YTD mountain NAMS YTD chart “We believe the Street is overlooking NAMS given past failures of CETP inhibitors and gradual launches of recent lipid drugs; however we believe obicetrapib is a best-in-class molecule optimized for LDL reductions with an attractive therapeutic profile,” he wrote. Timashev believes that obicetrapib, a cholesterol-lowering treatment, “can succeed where others have failed” due to the drug’s specific and idiosyncratic properties. Additionally, the drug has a history of success, consistently demonstrating a 40% to 50% LDL reduction in patients. “We see the current data as highly reproducible, and given the strong historical correlation of LDL reduction to cardiovascular outcomes we see a meaningful ~20% MACE [major adverse cardiovascular events] reduction as likely, which can enable an FDA approval and commercialization with a peak $2B+ revenue opportunity,” the analyst wrote. Timashev expects an FDA approval to lead to a potential commercial launch by 2027. Meanwhile, obicetrapib can also stand out as a solid choice between the drugs currently available to patients – either lower efficacy oral treatments, or higher efficacy injectable treatments that are also more expensive. “We believe obicetrapib can bridge the gap by providing an oral option that can win on pricing, convenience, and compete on efficacy and become a preferred switch option,” Timashev wrote. The analyst added that while current use cases for the drug involve lowering cardiovascular events, there’s also potential upside for other applications. Specifically, there’s a relationship between higher cholesterol levels and Alzheimer’s disease, which could be an avenue for NewAmsterdam to explore for future treatment opportunities. — CNBC’s Michael Bloom contributed to this report.
