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On Monday, Baird downgraded shares of Amylyx Pharmaceuticals Inc. (NASDAQ: AMLX) from Outperform to Neutral, with a significant reduction in the price target to $4.00 from the previous $37.00. This adjustment follows the unsuccessful outcome of the phase 3 PHOENIX trial of the company’s leading drug candidate, Relyvrio, which was being developed for the treatment of ALS (Amyotrophic Lateral Sclerosis).
The firm indicated that the decision to downgrade was made after the PHOENIX trial results did not meet the necessary benchmarks, leading to Amylyx halting the promotion of Relyvrio. The expectation set by the firm is that Relyvrio will likely be withdrawn from the market shortly due to these developments.
Amylyx’s stock has been impacted by the trial’s outcome, now trading near its cash value. Baird anticipates that the stock will continue to trade around this level in the foreseeable future. The firm suggests that the stock’s trajectory will likely remain unchanged until Amylyx outlines future plans that do not involve Relyvrio.
The company’s shift in focus away from Relyvrio comes as a significant pivot, considering it was their main product in the pipeline. The firm’s outlook for Amylyx is now closely tied to what strategic moves the company will make next, as it seeks to navigate beyond the setback from the PHOENIX trial.
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This story originally appeared on Investing
