FibroGen China sale ‘shrewd strategic transaction,’ says H.C. Wainwright

H.C. Wainwright analyst Matthew Keller keeps a Buy rating on FibroGen (FGEN) with a $10 price target after the company announced the sale of FibroGen China to AstraZeneca (AZN). AstraZeneca has agreed to obtain all rights to roxadustat in China, and FibroGen is set to receive an enterprise value of $85M in addition to FibroGen net cash held in China at closing, totaling approximately $160M, the analyst tells investors in a research note. The firm views the deal as a “shrewd strategic transaction” by FibroGen. The anticipated extension of the company’s cash runway strengthens its overall current and future financial health, contends H.C. Wainwright. It believes FibroGen now has the resources to follow through on its plans and potentially progress FG-3246 into late stage development.