Intercept Pharmaceuticals, a biotech company listed on NASDAQ under the ticker symbol ICPT, has been downgraded to a hold rating by Canaccord Genuity. This downgrade comes after Intercept announced its agreement to be acquired by Alfasigma for $19 per share in cash. Canaccord believes that this deal is the best possible outcome for Intercept, as its drug obeticholic is no longer being pursued as a treatment for NASH (nonalcoholic steatohepatitis) and Oclavia, another drug in its portfolio, potentially faces strong competition in the near future.
Canaccord described the acquisition as a win-win situation for both Intercept and its investors. The $19 per share price offered by Alfasigma is only slightly below Canaccord’s 12-month price target of $20, leading the company to reduce its rating to hold. Canaccord now has a price target of $19 for Intercept.
Overall, the downgrade reflects Canaccord’s view that the acquisition by Alfasigma presents the best outcome for Intercept given the challenges it faces with its drug development pipeline.