Guggenheim upgraded Genmab (GMAB) to Buy from Neutral on Tuesday, arguing that concerns over the Danish biotech’s growth prospects due to the loss of a royalty arbitration with J&J (JNJ) over its blockbuster multiple myeloma drug Darzalex are overblown.
With a $43 per share target on the stock, analyst Michael Schmidt noted that despite a recent rally relative to the SPDR S&P Biotech ETF (XBI), Genmab (GMAB) has underperformed the broader biotech space over the past two years.
Schmidt attributed the weakness to GMAB’s “moderate” pipeline wins and rising investor worries about its growth trajectory after 2029, given the recent loss of a royalty arbitration that denied it additional milestone and royalty payments from J&J (JNJ) for Darzalex.
However, the analyst upgraded Genmab’s (GMAB) royalty revenue forecast to a level above consensus, noting a continuing strong sales performance for the antibody therapy globally and the company’s other, more durable royalty streams.
Schmidt also argued that Wall Street has yet to fully appreciate the multi-billion-dollar revenue potential for the company’s AbbVie (ABBV)-partnered lymphoma drug, Epkinly, and highlighted its cancer medicine Rina-S as an “additional near-term value driver.”
The investigational therapy could be a best-in-class antibody-drug conjugate targeting ovarian and endometrial cancers with key catalysts scheduled for 2026, the analyst wrote, projecting above-consensus $1.5B worldwide sales for the drug by 2033 from platinum-resistant OC and EC.