Abeona stands to collect mid-single-digit royalties on sales of Ultragenyx’s Fayuvi plus up to $30 million in commercial milestone payments as part of a licensing deal.
- The Food and Drug Administration (FDA) on Thursday approved Ultragenyx’s Fayuvi, the first U.S. treatment for Sanfilippo syndrome type A, a rare and fatal childhood brain disease.
- Abeona developed the gene therapy as ABO-102, then licensed worldwide rights to Ultragenyx in 2022.
- Earlier in the day, Roth Capital started coverage of ABEO with a Buy rating and a $17 price target, citing optimism about the company’s commercial product, Zevaskyn.
Shares of Abeona Therapeutics (ABEO) closed up 4% in regular trading on Thursday and added another 2% after-hours after Roth Capital initiated coverage at Buy with a $17 target, and Ultragenyx won late-session FDA approval for Fayuvi, a gene therapy Abeona licensed away in 2022 and will collect royalties on after sales begin.
Why Ultragenyx’s Approval Mattered
The Food and Drug Administration (FDA) on Thursday approved Ultragenyx’s Fayuvi, the first U.S. treatment for Sanfilippo syndrome type A, a rare and fatal childhood brain disease. Abeona developed the gene therapy as ABO-102, then licensed worldwide rights to Ultragenyx in 2022.
Ultragenyx said on Thursday the product should reach treatment centers within 30 to 60 days. Abeona still stands to collect mid-single-digit royalties on sales plus up to $30 million in commercial milestone payments as part of the licensing deal.
A New Buy Rating On Zevaskyn
A fresh analyst rating added to the optimism. Earlier in the day, Roth Capital started coverage of ABEO with a Buy rating and a $17 price target, citing optimism about the company’s commercial product, Zevaskyn. The $17 price target implies a potential upside of about 204% from the stock’s closing price on Thursday.
Roth pointed to Zevaskyn’s lasting effect in recessive dystrophic epidermolysis bullosa, a severe blistering skin disease. Zevaskyn lists at about $3.1 million per course, but Roth noted no insurer has denied coverage so far. The firm expects Abeona to turn a GAAP profit in the first quarter of 2027 and to top $275 million in sales by 2029.
Second-quarter product sales for Zevaskyn were $11.4 million.
How Did ABEO Retail Traders React?
On Stocktwits, retail sentiment around ABEO stock rose from ‘bullish’ to ‘extremely bullish’ over the past 24 hours, while message volume remained ‘high.’
A Stocktwits user opined that Abeona cannot expect much revenue from UX111’s approval, given it caters to a rare pediatric disease affecting a small population.
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Another user noted that Abeona’s third-quarter revenue is now managed, thanks to Ultragenyx’s approval.
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ABEO stock has gained 6% year-to-date.
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