ARGENX initiation of coverage BUY – EUR440 initiation of coverage ARGENX BUY – EUR440TP | A one-of-a-kind biotech

We are initiating coverage on argenx (ARGX) with a BUY rating and a €440 PT ($433 for ADRs). Even with the recent stock performance, we believe the market hasn’t fully appreciated Vyvgart’s potential to be a $10-20bn franchise across 15+ indications, based on its broadly applicable mechanism of action. Given the momentum in the US commercial launch in generalized myasthenia gravis (gMG), we are confident that Vyvgart (efgartigimod) can reach near $2.6bn global peak sales in this indication alone, with upcoming Q3 sales to confirm the trajectory. Next, we believe both pivotal trials in CIDP ($1.8bn peak sales) and ITP ($1.1bn peak sales) are meaningfully de-risked with topline results expected in Q1 and H2 2023, respectively. That said, a delay is possible in the CIDP trial given the event-driven design, which we believe would be a positive. These trials are studying a more convenient subcutaneous (SC) formulation for which we expect BLA approval in gMG mid-H1 2023. Moreover, through 2023 ARGX will also report on several other indications for both efgartigimod and ARGX-117, and we expect the pace of readouts to accelerate further.
Vyvgart’s launch in gMG tracking well towards $2.6bn peak sales

The phase 3 CIDP read-out has a high likelihood of success but potentially delayed

ITP is already de-risked by the first phase 3 and sample size increase

We initiate coverage with a BUY and €440 PT