Soaring by 152% in December, is uniQure a worthwhile investment to purchase currently and maintain until 2025?
Soaring by 152% in December, is uniQure a worthwhile investment to purchase currently and maintain until 2025?
uniQure's shares, represented by the ticker symbol QURE, have experienced a significant upsurge. This surge is due to positive updates regarding the Food and Drug Administration (FDA) and the company's Huntington's disease candidate, AMT-130.
Over the first 12 days of December, uniQure's shares skyrocketed by 152%, sparking interest among investors about the stock's potential for further growth in 2025. To determine if this is a worthwhile investment, let's analyze the positive factors driving the stock and the challenges uniQure may face.
The reasons behind uniQure's stock surge
uniQure's shares soared on Dec. 10 after revealing positive news regarding AMT-130, an experimental gene therapy intended for Huntington's disease treatment. According to uniQure, the FDA is willing to review an application for expedited approval based on ongoing pair of phase 1/2 clinical trials.
An expedited approval based on ongoing trials could prove significant because Huntington's disease progresses slowly. The associated clinical trials the FDA plans to review initiated in 2019 and are anticipated to finish by 2029.
Reasons to remain cautious
The FDA has yet to commence reviewing an application for AMT-130's expedited approval. The FDA is slated to conduct an additional meeting with uniQure in the first half of 2025, aiming to outline a potential path forward.
Before fully trusting the FDA's green light, it's essential to remember the phase 1/2 trials consisted of a control group that underwent a sham procedure, rather than AMT-130 injections. These participants were allowed to switch to AMT-130 after 12 months, with several doing so. Regrettably, 12 months might be insufficient for early-stage Huntington's disease patients to exhibit measurable symptom exacerbation.
uniQure suggests that the FDA may compare data from the phase 1/2 studies against long-term natural history external controls. The FDA might even consider exploiting an external control group. Everyone involved would prefer to witness substantial improvement, contrasting the initially intended control group.
It's unlikely uniQure, a seasoned player in gene therapy development, would misrepresent FDA communications. In situations like this, though, it's critical to comprehend the agency might have demanded a new phase 3 trial, as Wall Street had anticipated. Communications with the FDA remain private, and the agency generally refrains from commenting publicly on the accuracy of a drug developer's press releases.
Gene therapies tend to be difficult to sell, as uniQure investors discovered with Hemgenix, its first approved therapy for hemophilia B distributed in 2022, with a list price of approximately $3.5 million. Unfortunately, uniQure's marketing partner, CSL Behring, has not sold much of the treatment. In the third quarter, uniQure reported licensing revenues of only $2.3 million.
AMT-130 is a one-time gene therapy, making it impossible to deactivate if unintended side effects arise. Wave Life Sciences is developing an RNA-based therapy with regular dosing, which could eventually gain favor within the Huntington's disease community.
Is it time to invest?
Huntington's disease is a hereditary disorder affecting around 70,000 individuals in the U.S. and Europe, making it more prevalent than hemophilia B. Furthermore, Huntington's disease patients have fewer treatment options, with no approved drugs to slow the disease's progression.
This summer, uniQure reported that treatment with AMT-130 significantly reduced the amount of harmful protein fragments indicative of brain damage. It also slowed disease progression by 80% compared to external controls, according to disease severity test scores.
With such compelling evidence of therapeutic impact, there's a strong possibility this drug will secure FDA approval in 2026. Independent drug launches can be unpredictable, but AMT-130 shows a far better chance in the underserved Huntington's disease field than Hemegenix did in the more well-serviced hemophilia B market.
Sales predictions for AMT-130 suggest more than $1 billion annually at its peak. The company likely won't require additional financing for several years, having ended September with $435 million in cash following $44.4 million in third-quarter expenditures.
At present, uniQure boasts a remarkably modest $734 million market cap that could easily increase tenfold if AMT-130 secures FDA approval and goes on to generate over $1 billion in annual sales. Investing in this stock now to hold for several years could prove to be a shrewd move, but only for those with an exceptionally high risk tolerance.
The surge in uniQure's shares has attracted interest from investors, who see potential for further growth due to the company's positive updates on AMT-130, an experimental gene therapy for Huntington's disease. This treatment, if approved, could potentially generate over $1 billion annually, making it an attractive investment opportunity for those with a high risk tolerance.
However, before investing, it's crucial to consider the challenges uniQure may face, such as the FDA's ongoing review of AMT-130's expedited approval application, the use of a control group in the phase 1/2 trials, and the potential market competition with therapies like Wave Life Sciences' RNA-based therapy. Investors should also be aware of the difficulty in selling gene therapies, as demonstrated by Hemgenix's low sales.