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Analyst Bullish on Raptor Pharmaceutical Corp. (RPTP) and BioMarin Pharmaceutical Inc. (BMRN)

By Christine Brown

On Tuesday, Hillary Clinton unveiled a plan for lowering the prices of prescription drugs after a pharmaceutical company exponentially increased a drug’s cost overnight. Clinton said, certain “bad actors” in the pharmaceutical industry are “making a fortune off of people’s misfortune.”

In light of this announcement, analyst Joseph Schwartz from Leerink Partners weighed in on two pharma companies. He says the concerns arising out of Hillary Clinton’s plans for pricing of pharma drugs are overdone.

Regarding Raptor Pharmaceutical Corp. (NASDAQ:RPTP), Schwartz maintained his Outperform rating for the firm. On September 14, Raptor announced topline results of a phase 2 study, which did not produce the desired outcome of improving nonalcoholic steatohepatitis (NASH) in children. According to The Fly, Schwartz does not view the NASH failure as a huge surprise. The analyst said, “We would take advantage of today’s stock weakness to buy RPTP, as we believe the current valuation ascribes little if any value to the company’s pipeline and the recent Quinsair acquisition.” However, Schwartz has lowered the price target for Raptor’s stock to $17 (from the earlier target of $20).

Schwartz is supportive Raptor management’s decision to not make any further investments in NAFLD (non-alcoholic fatty liver disease). He is also happy about the company’s plans to refocus its efforts on its rare disease assets. He said, “Now that NAFLD data is out of the way, we continue to believe that RPTP has a better opportunity to make a strong case for RP103 in Huntington’s Disease (HD), when Cyst-HD data is reported in 4Q15.”

According to The Fly, Schwartz has maintained an Outperform rating on BioMarin Pharmaceutical Inc. (NASDAQ:BMRN). Talking about the fears related to the proposed changes in Medicare pricing, the analyst cited a survey conducted by his firm, which shows that the reimbursement landscape continues to be favorable for commercially insured patients. According to Schwartz, the reimbursement scenario will be able to handle any potential changes in Medicare pricing.

Joseph Schwartz is a top-ranked analyst. He has a 59% overall success rate recommending stocks with a +30.4% average return per rating when measured over a one-year horizon and no benchmark.