Shares of Alvotech climbed on Wednesday after the biotechnology company scored a rare double upgrade from a Wall Street analyst expressing confidence the company will receive regulatory approval for three medications later this year.
Barclays analyst Glen Santangelo upgraded the stock to Overweight from Underweight and raised his price target to $8 from $4. Barclays expects the Food and Drug Administration to approve three Alvotech products this year targeting chronic inflammatory conditions, ophthalmology, and bone health.
Alvotech shares rose 7.9% to $5.42 on Wednesday, pacing toward their largest single-day increase since last December, according to Dow Jones Market Data.
The biotech requested review for the three drugs in early 2025, and the FDA is slated to make its decision on or before Dec. 4.
Santangelo's upgrade comes a few years after the FDA raised concerns about Alvotech's primary manufacturing plant in Iceland. The FDA's rejections were triggered by deficiencies found during pre-license, routine inspections of the plant regarding its manufacturing standards and facility compliance.
The administration noted, however, that the drugs themselves had no deficiencies. In July, the FDA formally closed the inspection, resolving the facility compliance and enabling the standard six-month review period.
Santangelo wrote that the FDA's inspection resolution could carve out an easier path for regulatory approval in December. He said the stock is an attractive buy for investors, noting that full-scale manufacturing resumed in the fiscal second quarter, with management reaffirming its fiscal 2026 revenue guidance range of $650 million to $700 million.
Alvotech has also eyed expansion beyond Iceland. Santangelo pointed to the biotech's partnership with Fujifilm Biotechnologies in the U.S. to boost manufacturing capacity starting in 2027.
The three drugs pending regulatory approval are biosimilars, or so-called copycats of existing drugs. Alvotech's AVT05 is a biosimilar to Simponi, a drug developed by Johnson & Johnson that is designed to calm the immune system to reduce joint pain and swelling.
AVT06 is Alvotech's version of Eylea, a specialized injection co-developed by Regeneron Pharmaceuticals and Bayer to treat serious retinal disorders. The drug aims to prevent abnormal blood vessels from leaking fluid into the back of the eye, helping to prevent patients from severe vision loss.
Alvotech's AVT03 replicates Prolia and Xgeva, two bone-protection medications from Amgen. The injectable drugs aim to block a specific protein in the body that breaks down bones, making them stronger.