Cowen Lifts Intercept's Price Target To $215 Following Ocaliva Approval

Cowen raised its price target on the shares of Intercept Pharmaceuticals Inc (NASDAQ: ICPT) by $3 to $215 after FDA approved its drug Ocaliva to treat a rare liver disease.

"We note the final label is broader than generally expected with responder/non-responder left to clinician discretion and no contraindication for cirrhosis," analyst Ritu Baral wrote in a note.

Baral, who has an Outperform rating on the stock, said Ocaliva will become an important treatment option for liver disorders including primary biliary cirrhosis (PBC) and non-alcoholic steatohepatitis (NASH).

Related Link: 3 Reasons Goldman Sachs Still Neutral On Intercept Pharma

"We think both indications, especially NASH, represent significant market opportunities. We think OCA will be approved for PBC in the EU in 2016 and that the drug will have a feasible and efficient path toward US approval for NASH, which we estimate around 2019," Baral noted.

The analyst, who said the approval was already priced in to the stock, expects peak U.S. NASH sales to reach $6.9 billion and worldwide PBC sales to reach $800 million.

"Our model currently assumes a US gross price of $80K per patient/per year with 20+% gross to net adjustments," Baral added.

At time of writing, shares of Intercept rose 3.48 percent to $146.71.