bluebird bio Inc (NASDAQ:BLUE), the gene therapy developer, is well-positioned to outperform pessimistic expectations regarding the launch of its Lyfgenia treatment.
Shares fell close to 70% in December, and analysts at Baird believe much of the negative sentiment surrounding the stock is due to disappointment by the lack of Lyfgenia cell collections.
In a regulatory filing from December, bluebird said it expects to see 85 to 105 patients initiate the treatment process across its three approved cell therapies Lyfgenia, Zynteglo, and Skysona in 2024.
While the number of cell collections has disappointed some investors, Baird notes that for patients to begin cell collection they must wait two months minimum to wash out any existing sickle cell therapies.
“While this process takes a bit of time, a number of patients have begun this process and it appears the initial cell collection is imminent,” the financial services group said.
Therefore, Baird believes bluebird’s progress highlights “robust demand and note treatment of just a handful of patients at each centre would yield substantial near-term sales”.
“All told, while the lack of cell collections to date is disappointing, we continue to believe near-term demand for Lyfgenia could outstrip the pessimistic market expectations,” Baird added.
Baird rates bluebird as an “outperform” stock and targets a US$7 share price, representing more than a 420% premium to its current market value.