Apellis Pharmaceuticals may be worth $90-$100 a share in sale - analyst

Apellis Pharmaceuticals (NASDAQ:APLS) may be worth $90-$100 a share in potential takeover, a Wells Fargo analyst wrote, after a report on Sunday that the biotech firm has received takeout interest from large drug companies. Apellis surged 15%.

"We look at this in two ways: 1) strip 50-65% of Opex out. APLS has a high rate of spend and these synergies + a premium get us to $93/shr," Wells Fargo analyst Derek Archila wrote in a note on Monday. "2) 5x EV/S multiple on our ~$2B global peak GA estimate + nominal value for PNH gets us to a $99/shr valuation. Either way, this would be a sizable deal ($10B+) for Big Pharma or Biotech."

The note comes after Bloomberg on Sunday reported that Apellis, a biotech firm that's focused on rare diseases and ophthalmology, is talking to advisers to consider its options after garnering interest from large pharma. Apellis (APLS) may also look at partnerships or licensing agreements for some of its ophthalmology products. There's no certainty a transaction will occur and Apellis prefers to remain independent, according to the report.

In February Apellis (APLS) won FDA approval for its marketing application for Syfovre's as a treatment for geographic atrophy secondary to age-related macular degeneration.

It's possible that a takeover of Apellis may be premature as Syfovre's GA launch is in the "very early innings" and the GA market is brand new, Wells Fargo's Archila, who has an equalweight rating and $55 price target on APLS, added. A possible buyer would likely want to know if ISEE gets a narrow label and if it can obtain European Union approval before making an offer for APLS.

In November, Apellis (APLS) announced that the FDA accepted the company's additional data filed for an application seeking approval of intravitreal pegcetacoplan to treat geographic atrophy secondary to age-related macular degeneration, sending the shares up 17% on Nov. 18.