BBIO On Track For Worst Day In 2.5 Months: What’s The Pfizer Connection?

• Pfizer said on Tuesday that it has reached settlement agreements with three generic manufacturers — Dexcel Pharma, Hikma Pharmaceuticals and Cipla Ltd. — resolving patent-infringement lawsuits over Vyndamax. 
• The deals, filed in U.S. District Court in Delaware, effectively push the U.S. patent exclusivity for Vyndamax to June 1, 2031.
• Morgan Stanley said in a note that the Pfizer settlement is at the lower end of investors' expectations.

Shares of BridgeBio (BBIO) fell 6% on Tuesday after rival Pfizer (PFE) reached a settlement with three generic drugmakers regarding its drug Vyndamax, which Wall Street deems at the lower end of expectations.

BridgeBio is a primary competitor to Pfizer in the Transthyretin Amyloid Cardiomyopathy (ATTR-CM) market, following the FDA approval of BridgeBio's drug, Attruby, which challenges Vyndamax.

PFE shares traded marginally in the red at the time of writing.

Pfizer’s Settlement

Pfizer Inc. (PFE) said on Tuesday that it has reached settlement agreements with three generic manufacturers — Dexcel Pharma, Hikma Pharmaceuticals and Cipla Ltd. — resolving patent-infringement lawsuits over Vyndamax.

The deals, filed in U.S. District Court in Delaware, effectively push the U.S. patent exclusivity for Vyndamax to June 1, 2031, subject to the outcome of any remaining litigation. The agreements avert an earlier generic entry that Pfizer had anticipated would trigger a sharp drop in U.S. sales beginning in 2029.

As a result, the company now expects Vyndamax revenues to remain relatively stable from 2028 through the middle of 2031.

Vyndamax treats cardiomyopathy caused by transthyretin-mediated amyloidosis (ATTR-CM), a rare and often fatal heart condition. It holds about 75% of prescription volume in the ATTR-CM category.

Wall Street Weighs In

Morgan Stanley said in a note that the Pfizer settlement is at the lower end of investors' expectations. The firm has an ‘Equal Weight’ rating and $28 price target on Pfizer shares.

Mizuho and Barclays believe a "major overhang" has been removed on BBIO shares. However, Mizuho expected the terms to be favorable for Pfizer. The settlement is likely occurring somewhere in the 2033-2035 timeframe, implying BridgeBio could potentially trade into the $90-$110 range on the near-term, the analyst told investors in a research note prior to the deal details announcement.

How Did Retail Traders React?

On Stocktwits, retail sentiment around BBIO stock jumped from ‘bullish’ to ‘extremely bullish’ territory over the past 24 hours, while message volume increased from ‘high’ to ‘extremely high’ levels.

Meanwhile, sentiment around PFE stayed within the ‘neutral’ territory while message volume remained at ‘high’ levels.

A Stocktwits user highlighted that Pfizer still won the settlement deal.  

Another said they added more BBIO shares in light of the dip.

A third user termed BBIO a “screaming buy.”

While BBIO stock has gained 96% over the past 12 months, PFE rose 15%.  

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