ABVX: GOLDMAN INITIATES AT BUY, PT EUR132 / ADR USD155
GS (Rajan Sharma) initiates coverage of Abivax at Buy on 9 Sep, PT EUR132
and ADR USD155, c.31%/30% upside vs the 8 Sep close of EUR101 / USD118.95.
That compares with average upside of 15% across their EU biotech coverage.
PT construction: 85/15 blend of a DCF at EUR120 per share (10% WACC, 0%
terminal growth) and a theoretical M&A value of EUR201 per share. The M&A
value applies an 11x multiple to risk adjusted 2032E revenue, in line with
the long term historical average for biotech transactions. GS carries
Abivax at M&A Rank 2 on their framework, a 15% to 30% probability band,
and weights the M&A component at 15%.
Model: unrisked peak sales of c.USD5bn / EUR4bn in UC, split c.USD4.3bn in
2L+ and c.USD700mn in 1L, plus c.USD4.5bn unrisked in Crohn's at a 33%
probability of success, EUR3.5bn risk adjusted. Revenue modelled at EUR35mn
in 2027, EUR214mn in 2028, EUR1,974mn by 2032. Positioning assumed
primarily 2L+, with 1L utilisation limited by rebate walls and the absence
of head to head data.
Safety: on the ABTECT maintenance cancer cases, GS expects the NMSC and non
skin cancer events to be carried in the warnings and clinical trials
experience sections of the label rather than a black box. They note the
JAK class holds c.USD1.1bn and 15% share of the US UC market despite black
box warnings, so even a more restrictive label leaves room for traction.
Catalysts per the note: FDA submission in UC late 2026, decision on the
combination agent in UC by year end 2026, ENHANCE-CD Phase 2b 12 week
induction data mid-2027, US launch from late 2027. Competing readouts
include Merck tulisokibart Phase 3 in UC in 2H26 and JNJ icotyde Phase 3
in 2028.
GS frames M&A as one route to value creation rather than the base case,
arguing self-commercialisation is viable following the recent financing,
and points to large cap biopharma capacity and the coming patent cliff as
the strategic backdrop.
Disclosures: GS beneficially owns 1% or more of common equity, had an
investment banking relationship with Abivax in the past 12 months, expects
to seek investment banking compensation in the next 3 months, and is a
registered market maker in the securities.