Incyte’s Povorcitinib Shows Promise but Faces Competitive and Market Challenges, Leading to Hold Rating

JMP Securities analyst Reni Benjamin has reiterated their neutral stance on INCY stock, giving a Hold rating today.

Reni Benjamin has given his Hold rating due to a combination of factors related to Incyte’s recent clinical trial results and market positioning. The Phase 3 trials for povorcitinib in treating hidradenitis suppurativa showed promising efficacy, particularly in patients previously treated with biologics, and Incyte plans to submit for regulatory approval by the end of 2025. However, despite the potential for significant revenue from povorcitinib, the current valuation of Incyte’s shares appears to be fair given the near-term market conditions.
While povorcitinib could become the first oral selective JAK1 inhibitor approved for this condition, it faces competition from established treatments like AbbVie’s Rinvoq, which already has brand recognition and multiple approvals. Additionally, biologics are perceived to have a safer profile, lacking the black box warnings that might accompany JAK inhibitors. These factors, along with the complex treatment landscape and payer requirements, suggest that povorcitinib’s role may be limited to post-biologic settings, influencing the Hold rating.

Benjamin covers the Healthcare sector, focusing on stocks such as Blueprint Medicines, Incyte, and BeiGene. According to TipRanks, Benjamin has an average return of -15.3% and a 30.58% success rate on recommended stocks.