Now could be the time of buy Telix Pharmaceuticals Ltd (ASX: TLX) shares.
That's the view of analysts at Bell Potter, which believe this ASX 200 stock could deliver huge returns over the next 12 months.
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What is Bell Potter saying about this ASX 200 stock?
Bell Potter notes that the company is close to learning the fate of its Zircaix product in the US market.
If it receives approval from the US FDA, the broker highlights that this will give the ASX 200 stock a first-mover advantage. It said:
The approval of the Biological Licence Application for Zircaix is now looming with a PDUFA date of 27 August. If approved, Zircaix will become the first radiopharmaceutical imaging agent to receive a label for the imaging of any renal mass. Investigators from the Zircon study concluded that ⁸⁹Zr- girentuximab accurately identified clear cell renal cell carcinoma (ccRCC) in patients with indeterminate renal masses with a favourable safety profile.
'These results establish the value of ⁸⁹Zr- girentuximab PET CT as a new standard, non-invasive tool for diagnosis, detection, characterisation and differentiation of ccRCC from other renal and extra renal lesions in clinical practice.' High praise indeed. The data is strongly supportive with high rates of sensitivity, specificity, PPV and NPV. In addition the company's IP is protected by patents extending beyond 10 yrs.
What's the market opportunity?
This new product could be a real cash cow for the ASX 200 stock if everything goes to plan.
Bell Potter estimates that Zircaix has a total addressable market (TAM) of around US$500 million. It explains:
The US market represents a near-term revenue opportunity, with initial estimates of ~113,000 scans annually for the characterisation of renal masses. Assuming pricing comparable to PSMA agents (US$5K per dose under transitional pass through), the initial TAM is estimated at >US$500m in revenue from a single patient scan. The data is also supportive of adoption to NCCN guidelines in the short term.
In light of the above, this morning Bell Potter has reaffirmed its buy rating and $34.00 price target on the radiopharmaceuticals company's shares.
Based on its current share price of $23.66, this implies potential upside of approximately 44% for investors over the next 12 months. The broker then concludes:
Zircaix is well-positioned to contribute to TLX's revenue from FY2026. Approval in August would allow the company 4 months to establish a new HCPCS code and Pass Through Pricing from 1 Jan 2026.
In the absence of reimbursement, FY25 revenues (from Zircaix) are likely to be negligible. Telix's FY2025 guidance of AU$1.18–$1.23bn excludes any revenues contribution from Zircaix. We retain our Buy rating and PT$34.00.
