BUZZ-Sagimet rises as Oppenheimer initiates coverage with 'outperform'

Reuters12-07
BUZZ-Sagimet rises as Oppenheimer initiates coverage with 'outperform'

** Drug developer Sagimet Biosciences' SGMT.O shares rise 8.4% to $5.05

** Oppenheimer starts coverage with "outperform" rating and PT at $30 — a 543.8% premium to Thursday's close of $4.66

** Brokerage sees "underappreciated opportunity" in co's lead experimental drug, denifanstat, being developed to treat metabolic dysfunction-associated steatohepatitis (MASH)

** MASH is a severe liver disease caused by fat buildup, leading to inflammation and damage

** The MASH market is dominated by Madrigal Pharmaceuticals' MDGL.O Rezdiffra

** "We see SGMT as ultimately benefiting from MDGL's build-out of the MASH market as diagnosis rates and reimbursement improve," brokerage says

** Oppenheimer expects risk-adjusted peak total revenues of ~$1.9 bln for denifanstat in 2040

** Including session's move, stock down 8.5% YTD

(Reporting by Kamal Choudhury in Bengaluru)

((Kamal.Choudhury@thomsonreuters.com;))

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