TAK - Jazz Pharma is down as Morgan Stanley cuts rating; competitive threat cited

Jazz Pharmaceuticals (JAZZ) is trading lower today as Morgan Stanley downgrades the stock to equal-weight from overweight, citing a balanced risk-reward ahead of a key data readout from a competitor.The analyst David Risinger and the team have lowered the price target to $166 from $177, implying only ~3.7% upside to the previous close. JAZZ shares have continued the four-day losing streak to trade ~4.9% lower today.Noting a ~44% rise in share price over the past six-month period, the analysts observe ‘a potentially significant competitive threat to Xyrem/Xywav.’ The two drugs indicated for narcolepsy and cataplexy are ‘Jazz's #1 franchise, and their sustainability is key for JAZZ shares,’ Risinger and the team argue.With a different mechanism of action to Xyrem/Xywav, the rival candidate, TAK-994 from Takeda Pharmaceutical (TAK) ‘could have a good chance to succeed’ the analysts write, expecting its Phase 2 narcolepsy/cataplexy readout ‘in coming months.’Seeking Alpha contributor, Edmund Ingham argued in

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Jazz Pharma is down as Morgan Stanley cuts rating; competitive threat cited