Goldman Sachs raises target price for dermatological drug maker MoonLake by 32%
The investment bank Goldman Sachs has raised its target price for the smaller biotech company MoonLake Immunotherapeutics by 32% to $82 per share, double the closing price on Friday, January 17. Promising results from studies of MoonLake’s drug for skin inflammation led Goldman Sachs to believe that it could become a benchmark therapy.
Details
On Friday, Goldman Sachs set a new target price of $82 per share for the Swiss company MoonLake, as reported by CNBC. This is 32% above the previous target price and nearly double the current share price. That day, MoonLake stock closed at $43.80 per share, having gained just under 6%. It dipped 1.4% in after-hours trading, however. Over the last 12 months, the stock is still down 24%.
Additionally, Goldman Sachs upgraded MoonLake from “neutral” to “buy,” citing the potential for the company’s candidate drug, sonelokimab (SLK), to boost the stock. This drug is designed to treat hidradenitis suppurativa, a chronic inflammatory skin condition.
“We now see the possibility of a brighter outlook on the premise that SLK can potentially deliver best-in-class results,” wrote Goldman Sachs analyst Richard Law, as quoted by CNBC.
He believes SLK could succeed in its final, phase III clinical trials after demonstrating “impressive efficacy” in the previous stages of testing.
According to MarketWatch, MoonLake has 13 “buy” ratings and no “sells” among coverage analysts. Their average target price is $81.67 per share.
About MoonLake
MoonLake, a biotech company from Switzerland, specializes in developing drugs for dermatology and rheumatology. Its portfolio includes one candidate, SLK, which is being studied for multiple indications, including hidradenitis suppurativa and psoriatic arthritis. The company points out that these inflammatory diseases affect millions of people worldwide and require new treatment options.
Goldman Sachs believes biologics have a bright future. It sees the percentage of patients using such drugs growing from 3.5% to 5.0% in the U.S. and 4.5% in Europe, driven by the introduction of new treatments and greater patient awareness of diseases and treatment options.
MoonLake has yet to generate revenue, but at the end of the 2024 third quarter, the company reported having almost $494 million in cash, enough to support its operations until the end of 2026.
