Suits Are Screaming 100%+ Upside for This Biotech After FDA Approval (It's All on The Label)

Usually when I hear the word “overweight,” it doesn’t exactly scream opportunity… it just brings back the trauma of that Delta flight to Austin where I got wedged next to a 600-pound dude who smelled like he lost a fight with a public toilet (Delta should’ve been paying me for my sacrifice.) But when Wall Street analysts start calling a $22 biotech stock “overweight” with price targets double… or even triple… that number, suddenly the term sounds a lot more flattering. 

That’s exactly what’s happening with Apellis Pharmaceuticals, a company that just got the FDA’s official stamp of approval on a drug that (checks notes) tackles a rare and nasty kidney disease that can lead to kidney failure… and might’ve just caught the market sleeping. In fact, shares surged 17% on the FDA news. 

On paper, this looks like a typical under-the-radar biotech moment: a company with a rough recent quarter, some analyst attention, and a just-approved drug that sounds like a spell from Harry Potter.

But zoom in, and things get more exciting. For starters, Apellis’ drug Empaveli just became the first FDA-approved treatment for C3 glomerulopathy (C3G)… a chronic kidney disease that affects about 5,000 people in the US. If you’ve never heard of it, good for your kidneys. If you have, you probably know just how brutal it is, and how few options exist. This approval opens up not just a new market for Apellis, but a rare chance to dominate it.

Apellis is trading around $22, while Cantor Fitzgerald just reiterated an Overweight rating and stuck with its $39 price target. H.C. Wainwright went even bigger with a $57 target, and William Blair is still shouting “Outperform” from the sidelines. Even the cautious folks at Mizuho (who wouldn’t get excited if they found oil in their backyard) still have a $20 price target on it. So yeah, that’s a pretty wide spread… from $17 to $60… but if you like playing the law of averages, it’s a straight-up “Buy.”

So why am I shouting about this on a Saturday like it’s breaking news? For one, Empaveli’s FDA label includes something its main competitor, Fabhalta, doesn’t: clear data showing that kidney function remained stable over time (measured by eGFR, for the kidney nerds out there). That time-series graph might not mean much to you or me, but to nephrologists and insurance companies, it’s a miracle. It’s the equivalent of getting five gold stars and a “great participation” sticker from the FDA. Oh, and Empaveli only needs to be administered twice a week via injector or pump, while Fabhalta users are stuck popping pills twice a day (patients hate taking meds twice a day, and so do the doctors who have to remind them).

Now let’s get into the numbers. Apellis brought in $178.5 million in Q2 revenue… down 10.6% year over year and a 6% miss versus estimates. Its EPS came in at -0.33, which technically beat the -0.44 expected by analysts (yay for losing less money?). Revenue from Empaveli itself was $20.8 million, down 15% year-over-year, while sales of their other key drug, SYFOVRE, slid slightly to $150.6 million. 

And just to keep things interesting, Apellis recently struck a $300 million deal with Swedish Orphan Biovitrum (Sobi), giving up 90% of future ex-U.S. royalties on Empaveli in exchange for some quick cash. That’s either a savvy capital move or the biotech version of selling your car title to pay rent… depends on how much faith you have in U.S. sales.

So is Apellis sitting on a breakout opportunity… or just dressing up another biotech long shot in an FDA-approved costume? That depends on how you see the setup. Analysts project $4.5 million in revenue for Empaveli’s new indication in 2025, ramping up to $106 million in 2026. And if Apellis can carve out meaningful share in the $1 billion C3G market before competitors show up guns blazing, this could turn into a textbook case of first-mover advantage paying off. If they fumble the rollout or can’t convert FDA buzz into actual prescriptions, though, we’ll be looking back at that royalty deal and saying “what could have been”. 

Just look at Vertex Pharmaceuticals. Back in 2012, it was a nobody biotech trading under $30 when it got FDA approval for Kalydeco, the first drug to treat the root cause of cystic fibrosis. The patient population was small, but the science was solid… and that one win snowballed into a massive franchise. Today, Vertex trades above $450 with a market cap north of $100 billion, all because it dominated a rare disease niche before anyone else caught on.

Of course, Apellis isn’t perfect. (Far from it.) But at $22, with analysts tossing out $30, $40, even $50+ targets, this has the markings of a high-risk, high-reward swing that could pay off if Empaveli sticks the landing. The science is real. The market is wide open. The FDA label’s got some weight behind it. And honestly? If being called “overweight” comes with a 100% upside, I might start asking to be called that.

At the time this article was published Stocks.News does not hold positions in companies mentioned in article.