Degroof Petercam announced on Wednesday that it had initiated coverage of GenSight Biologics shares with a Buy recommendation and a price target of 8.5 euros.

The Belgian investment house explains that it expects European approval for Lumevoq, its gene therapy for the treatment of Leber's hereditary optic neuropathy (NOHL), during the first quarter of 2024.

According to Degroof, which has "high expectations" for Lumevoq, the biotech company could break even two years after product launch, i.e. before the end of 2026

Its analysts expect sales of up to €310 million a year for Lumevoq.

But Degroof Petercam says it sees even greater potential for GS030, the company's second project, due to its ability to address multiple indications.

For retinopathy pigmentosa (RP) alone, sales could reach 565 million euros, according to its calculations.

While Degroof Petercam acknowledges that the share price has been penalized by operational problems which have led to the postponement of Lumevoq's commercialization, it expects these difficulties to be resolved by the third quarter, which it believes should revive interest in the stock.

Its price target of 8.5 euros currently implies a potential appreciation of 264%.

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