Arrowhead Stock's Surge Will Continue, Analyst Says

The biotech’s stock has already more than quadrupled in 2019 but Chardan’s Keay Nakae says Arrowhead has more upside ahead.

The biotech’s stock has already more than quadrupled in 2019 but Chardan’s Keay Nakae says Arrowhead has more upside ahead.

Arrowhead Pharmaceuticals stock will soar even higher, according to Chardan analyst Keay Nakae in a note out Friday morning.

Nakae maintained his Buy rating on Arrowhead stock (ticker: ARWR) and increased his price target to $81 from $45. The biotech’s shares closed at $69.02 before the Thanksgiving break, and have already more than quadrupled this year.

The increased price target was based on Nakae’s new analysis of data on the company’s pipeline, which develops RNAi therapies that largely focus on liver diseases. Nakae now says that the company’s experimental hepatitis B treatment, called JNJ-3989, has a 55% chance of success. The treatment is being developed with collaborator Johnson & Johnson (JNJ).

Nakae also increased his estimate of success for other Arrowhead programs.

A surge of interest in RNAi drugs, plus the strong data coming out of Arrowhead’s pipeline, has rendered the stock red hot in recent months.

The back story. Arrowhead stock is up 72.3% in November alone, during which time the S&P 500 has risen just 3.4%. The stock has been boosted by Novartis’s (NVS) $9.7 billion agreement earlier this week to acquire Medicines Co. (MDCO), which, like Arrowhead, develops RNAi drugs. There has also been positive data on its hepatitis B drug, and on other drugs.

What’s new. In his note on Friday, Chardan’s Nakae wrote that the stock had benefited not only from Medicines Co.’s deal, and from the JNJ-3989 data, but also from new data on ARO-ANG3 and ARO-APOC3, Phase 1 drugs from Arrowhead that seek to treat dyslipidemia and hypertriglyceridemia.

In addition, Nakea said that Arrowhead stock had also been boosted by news of a deal between Novo Nordisk (NOV) and Dicerna (DRNA) to investigate RNAi therapies, which has also increased investor focus on RNAi.

Nakea said that he now estimates that the probability of success for ARO-ANG3 and ARO-APOC3 is 35%.

Looking forward. Nakea expects the company to offer new data on ARO-ANG3 and ARO-APOC3 at the end of March. The company says it expects to have 10 drugs in clinical trials by the end of 2020.

Write to Josh Nathan-Kazis at

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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