Cavendish has reiterated its buy rating on Shield Therapeutics PLC (AIM:STX, OTCQB:SHIEF) following the pharmaceutical company's agreement to take full commercial control of its main United States (US) product from Viatris.
The broker kept its target price at 23 pence, implying potential upside of 318% from current share price of about 5.5 pence.
Shield, which is listed on London's AIM market, announced on Thursday that it would assume full responsibility for ACCRUFeR, an oral iron replacement therapy, in the US from 30 September.
The company will take over commercial operations without making any upfront cash payment.
Instead, Shield will pay Viatris a reduced royalty on US net sales, ranging from high single digits to the mid-teens, over five years.
Cavendish called the deal one of the most significant strategic developments for Shield since its original US agreement in 2022.
The broker said bringing the sales team in-house should improve profit margins, even as operating costs rise.
Shield's management expects the transaction to be immediately value accretive to the business.
Cavendish forecasts Shield's revenue will rise to £78.7 million in the 2026 financial year, up from £49.7 million in 2025.
