CS: Rigel Pharmaceuticals Inc. (RIGL) Outperform [V] M. Aberman
CP: US$ 24.90 TP: US$ 37 CAP: US$ 909.1m
ACR 2008 - Landscape for Oral RA Agents
• Conclusion: There is not much new to the ACR abstract for R788, which contains the 12-week data for R788 in RA. That
said, R788's efficacy data continues to compare very favorably with the other oral kinase inhibitors targeting RA (e.g. Pfizer's
JAK-3 and Incyte's JAK 1/2 inhibitor) and there were no new safety signals reported. Pfizer's lack of dose response could
limit efficacy to what we have already seen, but could allow a lower dose to be used with potentially less toxicity. Incyte's data
look encouraging; however, we believe the data are too early (4 weeks) and too sparse (12 patients) to draw any firm
conclusions. We think all of these agents/targets show promise and given the size of the market, there will be room for many
players. One potential advantage for R788 is that, to our knowledge, they are the only company that is targeting SYK. On the
safety side, both Rigel's R788 and Pfizer's JAK3 have had tolerability signals and we look forward to the plenary session and
company-sponsored update discussing one-year safety data of the Phase IIA R788 trial in RA to gain better insight into both
efficacy and tolerability.
• What's New? Abstracts from ACR (American College of Rheumatology) 2008 have been released, with new efficacy and
safety data kinase inhibitors including Rigel's oral syk kinase inhibitor R788, Pfizer's JAK-3 inhibitor CP-690,550, and Incyte's
JAK-1&2 inhibitor INCB018424.
• Implication: We remain Outperform rated with our existing price target of $37. We continue to believe that Rigel is
undervalued given its proof of concept efficacy in RA, ITP, and non-Hodgkin's lymphoma. The Phase II data set of R788 in
RA, including a full year of safety data, should be another positive for the stock when it is presented at ACR in October, and
we view a strong partnership as another potential positive catalyst in late 2008/early 2009 |
