Prothena’s downside move may be excessive, says RBC Capital

Prothena (PRTA) shares are down roughly 20% on Monday, likely due to the announcement of the departure of CMO Hideki Garren on Friday, ahead of multiple pipeline readouts from prasinezumab, birtamimab, and potentially ‘012, and also due in part to a Science article last week that detailed alleged scientific manipulation associated with the preclinical development of many agents, including prasinezumab, RBC Capital analyst Brian Abrahams tells investors in a research note. While RBC remains cautious on Prothena’s upcoming updates, the firm notes that outgoing CMO Garren is heading to Roche (RHHBY), a major role that potentially supports that Garren’s departure may not have been due to any particular misgivings about the company’s clinical programs, and says the Science article does not materially increase the firm’s skepticism. RBC, which maintains a Sector Perform rating and $24 price target, believes the 20% move may be excessive.