Stifel downgrades Keryx to hold

Stifel downgraded Keryx Biopharmaceuticals (NASDAQ:KERX) to “hold” from “buy” and removed its price target after the company announced an imminent supply disruption with its Auryxia product. The stock closed at $4.72 on Monday.

Analyst Stephen Willey writes that the supply interruption is yet “another hurdle in what has been a frustratingly inconsistent commercial launch – with any/all traction made with the recently-expanded sales force initiative now at a halt for at least another three months while a second contract manufacturer is brought online (an event which admittedly reintroduces additional regulatory risk associated with the November 13 PDUFA date).”

While still positively-biased towards the iron-deficient anemia opportunity into chronic kidney disease and the potential impact a formal hemoglobin claim may have on improving product perception within the dialysis setting, he said the “extended timelines to formal label-expansion (likely early-2H17) and likely manufacturing-related reset of prescriber confidence in the dialysis setting limits any sense of urgency here.”