Allergies are a big problem in the world today. Some consumers have made a choice to avoid certain foods or avoid certain ingredients, but some people literally have to avoid certain things at the risk of inflammation, serious illness or even death. One allergy that has been rather problematic for the public is peanut allergy.

Aimmune Therapeutics, Inc. (NASDAQ: AIMT) has become the go-to company that has a fight against peanut allergies for certain people. After receiving FDA approval of PALFORZIA as a oral immunotherapy treatment for peanut allergy, its shares have backed handily off of their highs above $35 from mid-January. One brokerage firm has been quite positive on Aimmune Therapeutics and if they are proven correct investors might have well over 100% upside to look forward to.

Liana Moussatos of Wedbush Securities has reiterated the firm’s Outperform rating on Aimmune. She has lowered her target price down to $66 from $74 after previously having a high of $81 for the stock. Some target price cuts are not well received, but this stock being close to $23 still represents close to 200% in implied upside.

With the PALFORZIA launch ongoing, Liana Moussatos sees the potential for Aimmune to popularize the oral immunotherapy treatment for peanut allergy in the United States. It was on January 31, 2020 that the FDA approved PALFORZIA for the reduction of allergic reactions, which included anaphylaxis, which may occur from accidental peanut exposure.

The company reported results on February 27 with a loss of -$1.06 per share being more or less in-line with the -$1.05 per share consensus. While that looks and sounds like a large loss per share, the commercialization will take a while to translate into profitability if it becomes widely adopted post-approval. Liana Moussatos noted that the drug launch is underway and that the company’s field force and market access team have been making inroads with clinicians and payers. The report said:

The Company launched a PALFORZIA™ Risk Evaluation and Mitigation Strategy (REMS) website (URL: palforziarems.com) to facilitate REMS certification for clinicians. Management was encouraged that 300 allergists completed the REMS certification process within the first 4 days the site was online. Management does not anticipate the REMS plan to impact potential U.S. launch as the Company included mitigation strategies in the original BLA package. Management announced the wholesale acquisition cost (WAC) of PALFORZIA™ will be $890/month. We project PALFORZIA™ could achieve close to $900 million in annual sales worldwide starting in 2023.

Along with U.S. approval now in the bag, Moussatos also noted the path to potential E.U. approvals, as well as ongoing clinical trials and recent business development potential. The company is expected to present nine posters on PALFORZIA data and real-world oral immunotherapy treatment implementation at the American Academy of Allergy Asthma & Immunology Annual Meeting that is slated for March 13 to March 16.

The company is also working on an egg allergy treatment with enrollment expected to be completed in the first half of 2021; and Aimmune recently announced that it has obtained an exclusive worldwide license to develop and commercialize a treatment from from Xencor as well as an additional $200 million in equity investment from Nestle Health Science. Aimmune drew down the remainder of its $85 million line from the KKR loan in February 2020.

Where Wedbush sees the big growth is in revenues, effectively ramping up to a blockbuster drug category in the coming years. With expected 2020 product sales expected to be just $18.67 million, the official projections for product sales ahead are as follows:

• $91.3 million in 2021,
• $310.6 million in 2022,
• $899.3 million in 2023,
• $1.83 billion in 2024,
• and ultimately $2.46 billion in 2025.

Shares of Aimmune were last seen trading down 3.8% at $22.92 during Tuesday’s sell-off against a 52-week trading range of $16.95 to $37.00. Its current market capitalization is about $1.49 billion.

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