Mizuho cuts BioXcel to neutral, cites reduced expectations for lead drug (BTAI)

Mizuho downgraded BioXcel Therapeutics (NASDAQ:BTAI) to neutral and slashed its price target in the wake of the company’s Q2 earnings report and restructuring news.

The investment bank said that it was now taking a “more conservative” view of the company’s lead asset, Igalmi/BXCL501, and reduced its peak risk-adjusted sales estimates to around $500M from $1.1B. It also pushed out the “timing and magnitude of potential revenue” for Igalmi in the treatment of Alzheimer’s disease agitation.

Mizuho said it finds the shares “appropriately valued” given its revised model, limited catalyst calendar and cash runway, which runs into mid-2024. It added that it might revisit its current base view case and assumptions if the company reports positive updates from its planned meetings with the FDA.

Mizuho also reduced its price target for the stock to $4 from $40.