UBS on AbCellera Biologics (ABCL.US): Cool Relief, Hot Commercial Opportunity; Initiation at Buy
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UBS initiates coverage of AbCellera Biologics (ABCL.US) with a Buy rating and an $18.00 target price. The core thesis rests on ABCL635, which shows best-in-class potential in treating menopausal vasomotor symptoms (hot flashes). In Phase 2, ABCL635 delivered a placebo-adjusted reduction of 5.3 hot-flash episodes at week 4 and a predicted reduction of 10.2 episodes at week 12, outperforming oral small-molecule rivals such as Veozah and Lynkuet on efficacy and safety. Its once-monthly dosing convenience and absence of reported liver transaminase elevations — potentially avoiding routine liver monitoring — add differentiation. KOL feedback suggests peak penetration of roughly 25% among patients unsuited to hormone therapy. UBS forecasts 2035 risk-adjusted sales of $3.3 billion in the menopause market versus consensus of $1.5 billion, plus about $420 million from oncology-related hot flashes, underpinning a valuation based on 1.5x peak sales. Catalysts include 12-week Phase 2 follow-up data in late 2026 to early 2027, ABCL386 IND filing and Phase 1/2 start in 2027, ABCL688 Phase 1/2 studies, and a potential FDA approval of Lynkuet in breast-cancer hot flashes in H1 2027.
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