02:26 PM EDT, 04/29/2024 (MT Newswires) -- BioMarin Pharmaceutical ( BMRN ) investors were surprised by lower-than-expected sales of one-time gene therapy Roctavian, a treatment for adults with severe hemophilia A, UBS said in a note Monday.

On the contrary, the investment firm believes the therapy is overfocused and sees potential in BioMarin's enzyme replacement therapy business which is "underappreciated at current levels."

Investors were mainly surprised by Roctavian sales of $800,000, falling short of the consensus for roughly $4 million, UBS said.

Without Roctavian, UBS' model suggests a base case valuation of $115 per share, assuming also quarterly expenses decrease by nearly $40 million starting in 2025. This analysis excludes any upfront payment or divestment benefits.

UBS expects 2024 revenue for the company to be about $2.75 billion, in line with the guidance of $2.7 billion to $2.8 billion. For Roctavian, UBS expects 2024 revenues of $9 million, compared with $31 million previously, as it has "limited visibility into the near-term revenue trajectory, given the recent payor/reimbursement challenges."

UBS has a buy rating for BioMarin with a price target of $119.

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