Deutsche Bank raises Shire price target as survey suggests upside

Deutsche Bank bumped up its price target for Shire to 6000p from 5900p.

“Following a detailed analysis of Shire’s pipeline and growth prospects, we believe the company's targets for achievement of $10bn in sales by 2020 now look like no more than a ‘base case’ scenario,” said DB.

The broker said its proprietary survey of US ophthalmologists suggests upside to management's blockbuster sales target for new dry eye disease drug lifitegrast.

“With further upside from the pipeline and capital deployment, we see room for the shares to perform as investors gain confidence in growth beyond the end of the decade,” it said.

Deutsche said it believes Shire will use the launch of lifitegrast as a stepping stone to building a leading ophthalmology franchise.

“We understand management is looking at assets both in the back of the eye and front of the eye disease. We also expect the company to continue to bolster its pipeline through smaller bolt-on deals, with potential to leverage further pipeline success to build additional franchises in new areas such as anti-infectives and neonatology,” it added.

DB rates the stock at ‘buy’.