Why Aegerion Pharmaceuticals Shares Jumped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Aegerion Pharmaceuticals (NASDAQ: AEGR  ) , a specialty biopharmaceutical company, jumped as much as 17% after receiving a price target hike from JPMorgan.

So what: Following the stock's already monstrous run higher, JPMorgan kept its "outperform" rating on Aegerion but upped its price target to $69 from $48. The basis for the price target hike included better physician feedback, increasing patient referrals, and a recent price hike in Juxtapid, Aegerion's lone FDA-approved drug that is used to treat homozygous familial hypercholesterolemia, or HoFH.

Now what: Without letting my emotions get the better of me, I'd call this move higher over the past couple of months in Aegerion absolutely insane! What's more, I'm not sure that increasing the annual price of the treatment from $235,000 to $295,000 is the smartest move. If you recall, Isis Pharmaceuticals (NASDAQ: ISIS  ) and Sanofi's (NYSE: SNY  ) also had their HoFH drug, Kynamro, approved just weeks after Juxtapid -- and it's being priced at a big discount to Juxtapid. For ease of use, Juxtapid is the hands-down winner as it's an oral treatment compared to Kynamro, which is infused. But at a difference of more than $100,000 annually, I'd have to think that Aegerion is playing with fire by boosting its drug price. Needless to say, I'd suggest keeping a football field's distance between you and Aegerion until we get a few quarters of Juxtapid sales under our belt.

Craving more input? Start by adding Aegerion Pharmaceuticals to your free and personalized watchlist so you can keep up on the latest news with the company.

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Read/Post Comments (5) | Recommend This Article (4)

Comments from our Foolish Readers

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  • Report this Comment On May 29, 2013, at 3:28 PM, arthurs1 wrote:

    Sean, insane it is, doesn't seem to matter right now, the stock is already priced at 2 xs projected all time sales of 1 Billion and if they hit that, everything has to go right and at that point they have negative growth.

    Importantly, ISIS drug Kynamro is not infused, it's self injected in pre filled syringe just like with diabetes usually once a week and at home.

    The CEO of AEGR (Debeers) is the world's greatest spin doctor and he is printing money faster for the investment firms than the Fed with his best case scenarios.

    I think the best word that comes to mind is collusion.

  • Report this Comment On May 29, 2013, at 4:57 PM, arthurs1 wrote:

    2013 NATIONAL LIPID ASSOCIATION ANNUAL SCIENTIFIC SESSIONS

    MAY 30-JUNE 2, 2013

    LAS VEGAS, NV

    Session Type Poster Presentation

    Session Title Pharmacological Control of Lipids and Lipoproteins

    Dates and Times Friday, May 31, 2013 – 1:00 p.m. to 2:00 p.m. PT

    Saturday, June 1, 2013 – 12:30 p.m. to 1:30 p.m. PT

    Poster Number 167

    Presentation Title

    LONG TERM EFFICACY AND SAFETY OF MIPOMERSEN

    DURING 4 YEARS OF TREATMENT IN A COHORT OF

    PATIENTS WITH HETEROZYGOUS FAMILIAL

    HYPERCHOLESTEROLEMIA AND CORONARY ARTERY

    DISEASE (CAD)

    Duell PB1, Rose JE1, Selvey S2, Alam S2, Mittleman RS2

    1Oregon Health & Science University, Portland, OR 2Genzyme, a Sanofi

    Company, Cambridge, MA

    Session Type Poster Presentation

    Session Title Pharmacological Control of Lipids and Lipoproteins

    Dates and Times Friday, May 31, 2013 – 1:00 p.m. to 2:00 p.m. PT

    Saturday, June 1, 2013 – 12:30 p.m. to 1:30 p.m. PT

    Poster Number 168

    Presentation Title

    LACK OF DRUG-DRUG INTERACTION BETWEEN

    MIPOMERSEN AND WARFARIN IN HEALTHY VOLUNTEER

  • Report this Comment On May 30, 2013, at 5:41 AM, ReuReu wrote:

    Thank you, Hater. I'm sure it's upsetting to not only miss the first major run in the stock, but now this 2nd one afterward. Maybe you were one of the many who tried to talk AEGR down, failed, and couldn't buy-in after the first major one. Ouch. And right before the upcoming AEGR approval in Europe (where there are zero competing drug alternatives). AEGR will, hopefully, hit 80 before then which is its average price target now from other investment firms. If JP Morgan was colluding with them, you'd think they would agree on a price. Silly Arth.

  • Report this Comment On May 30, 2013, at 6:44 AM, harry2013 wrote:

    Is it a done deal that the insurance companies will pay for a drug that costs $300K per year for a genetic condition that will never improve?

  • Report this Comment On May 30, 2013, at 12:40 PM, cyberianlady wrote:

    guys - do your homework on this stock, the orphan disease market and the management team - and you will be pretty blown away.

    If you look at the BOA investor presentation - there were multiple impressive things. Sales force ramp-up. The pricing power and gross to net speak for themselves - as does the pricing cap which is much appreciated by payers. Do you think they could have raised the price if the other drug was going to kick their butt? They just freed up additional $ for promotions in a tough, competitive market. They just found out that the market is larger than they thought - AND they looked into data from a huge clinical testing lab to find this out. They have an all-star team that wrote the book on this from the Genzyme days - not to mention a stellar regulatory and EU team. Also do your HW on the CEO - he's great at raising $ (he did so under tough market conditions), and is clearly good at managing the street. Also, a CEO who is willing to engage with patients and go on regular field rides is showing commitment to helping patients. Not all leaders will do this.

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