Neurocrine Executing Very Well With Its Lead Commercial Compound

Neurocrine Biosciences (NBIX) was never set up for a great year in 2019 from a clinical data/pipeline perspective, but management is compensating so far with strong sales execution with its approved drug Ingrezza. With the company now free cash flow positive, management has a lot of options when it comes to M&A and/or in-licensing, not to mention sponsoring robust clinical programs for promising new candidates. That said, this has always been a very deliberate, patient management team and investors shouldn’t expect that to change – this is very much a “do it right” as opposed to a “do it right now” company.

I’m content to wait, as Neurocrine has shown that it can develop effective drugs, market them well, and avoid wasting resources on low-probability assets. I believe fair value for the shares is around $120, with around 70% of that from Ingrezza, but meaningful potential data-driven upside from the CAH program and possibly underestimated potential for opicapone as well.

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Neurocrine Executing Very Well With Its Lead Commercial Compound