ROIV and IMVT programs are progressing broadly as planned, with a catalyst-rich second half for ROIV, but brepocitinib commercialization expectations have been delayed to 2028

Overview

The report updates its forecast models following the two companies' 1Q27 updates. Bernstein believes ROIV's and IMVT's R&D programs are progressing broadly as planned. The key change for ROIV is the initiation of the Phase 3 trial of brepocitinib in cutaneous sarcoidosis and the delay of its launch and sales forecasts from 2027 to 2028. The firm continues to take a more positive view of ROIV while maintaining a neutral rating on IMVT.

Core views

First, the report focuses on the Phase 3 BEACON+ trial of brepocitinib for cutaneous sarcoidosis (CS). The trial has enrolled its first patients, and topline data are expected in 2028. The primary endpoint is at least a 50% improvement in CSAMI-A at Week 16. Management did not disclose the precise response rate from the Phase 2 trial but stated that well over 50% of treated patients reached this endpoint, compared with 0% in the placebo arm, supporting the sample-size and statistical-power assumptions for the Phase 3 trial. The overall Phase 2 results also support a substantial treatment effect. Participants had a mean baseline CSAMI-A score of 33.6. At Week 16, the 45mg brepocitinib arm showed a mean reduction of 22.2 points, versus a 0.7-point reduction in the placebo arm, for a between-group difference of 21.6 points and a decline exceeding 50% of baseline. All patients in the 45mg arm achieved at least a 10-point improvement in CSAMI-A, compared with only 14% in the placebo arm. In the 45mg arm, 62% of patients achieved a CSAMI-A score below 5, representing what the report describes as functional remission, compared with 0% in the placebo arm. This result is particularly notable because the 45mg arm consisted of the most difficult-to-treat patients, with longer disease duration, greater pre-existing damage, and a higher proportion of plaque morphology. The arm included 13 patients, with a mean disease duration of 10.2 years, and 85% had plaque morphology. Second, Roivant is entering a catalyst-rich period in the second half of 2026, including Phase 2 PH-ILD results for mosliciguat, Phase 3 non-infectious uveitis (NIU) results for brepocitinib, Phase 2 cutaneous lupus erythematosus (CLE) results for IMVT-1402, second-stage data and an update on regulatory discussions for difficult-to-treat rheumatoid arthritis (D2T RA), the commercial launch in dermatomyositis (DM) by September at the latest, and the external event of argenx's Phase 3 topline results in idiopathic inflammatory myopathy (IIM). The report views the Phase 2 PH-ILD and Phase 3 NIU results as the two most important reasons to own ROIV. For PH-ILD, management did not provide a specific minimal clinically important difference threshold for six-minute walk distance (6MWD), instead emphasizing that the program needs to achieve an approvable level of efficacy. For NIU, management noted that placebo response rates in immunology clinical trials can vary substantially, potentially representing the greatest risk to the Phase 3 trial. Nevertheless, management remains confident in the Phase 3 trial based on the strong Phase 2 results. Argenx's Phase 3 IIM results could also provide external validation of, or have negative read-through implications for, brepocitinib's commercial opportunity in DM. Regarding the forecast model, Bernstein delayed the assumed launch and sales start for ROIV's brepocitinib from 2027 to 2028 and updated other income based on actual 1Q27 interest income. The report states that these adjustments result in only modest changes to net income and EPS from 2027 through 2035, while the appendix lists the affected period as 2027 through 2036. The appendix forecasts ROIV revenue rising from $8 million in 2026 to $30 million in 2027 and $315 million in 2028, with diluted EPS of -$0.43, -$1.39, and -$1.55, respectively. IMVT forecasts were unchanged. Regarding ratings and valuation, Bernstein maintains its Outperform rating and $41 target price for ROIV. The target price is the average of the DCF and sum-of-the-parts valuation results, with the DCF using a 9.5% weighted average cost of capital and a -3% terminal growth rate. IMVT retains its Market-Perform rating and $37 target price, which is the average of the DCF and enterprise value/revenue valuation results. The DCF uses an 11.5% weighted average cost of capital, while the revenue multiple is 1.25 times 2035 revenue. On August 19, 2026, ROIV and IMVT closed at $37.40 and $44.96, respectively.

Analysis framework

The report first reviews the two companies' program progress following 1Q27 and then uses brepocitinib Phase 2 patient baselines, changes in continuous measures, and response rates to explain the Phase 3 BEACON+ endpoint and statistical assumptions. It subsequently outlines the clinical, regulatory, and commercialization events expected in the second half of 2026 and identifies the key variables determining each program's success or failure. Finally, the firm incorporates changes in program timing and actual interest income into its financial models and determines target prices using DCF, sum-of-the-parts valuation, and revenue multiples.

Methodology notes

• Valuation MethodDCF Discounted Cash Flow

  Discounted Cash Flow Valuation

  The report estimates company value by discounting future cash flows. ROIV uses a 9.5% WACC and a -3% terminal growth rate, while IMVT uses an 11.5% WACC. Each result is averaged with another valuation method to derive the respective target price.

• Valuation MethodSOTP Sum-of-the-Parts Valuation

  Sum-of-the-Parts Valuation

  The report separately assesses and aggregates the value of ROIV's various assets or programs, then averages that result with the DCF result to derive the $41 target price.

• Valuation Method

  EV/Revenue Multiple Valuation

  IMVT's valuation uses an enterprise-value-to-revenue multiple of 1.25 times 2035 revenue, averaged with the DCF valuation to derive the $37 target price.

• Event Trading and Behavioral FinanceEvent-driven analysis

  Clinical and Regulatory Catalyst Analysis

  The report chronologically reviews events involving PH-ILD, NIU, CLE, D2T RA, DM commercialization, and external competitor data, assessing their potential impact based on trial endpoints, historical efficacy, and variability in placebo responses.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Roivant Sciences Ltd. (ROIV)

  The report views it as a biotechnology company with numerous catalysts in the second half of 2026 and considers Phase 2 PH-ILD and Phase 3 NIU the most critical value-driving events.

  Strengths

  Brepocitinib showed strong Phase 2 efficacy in cutaneous sarcoidosis, with all patients in the 45mg arm improving by at least 10 points and 62% achieving a CSAMI-A score below 5; multiple clinical and commercialization events are approaching.

  Weaknesses

  The forecast launch and sales start for brepocitinib have been delayed from 2027 to 2028, and the model still projects net losses in 2027 and 2028.

  Comparison

  In the Phase 2 cutaneous sarcoidosis trial, the 45mg arm showed clear differences versus placebo in mean CSAMI-A change, the percentage achieving at least a 10-point improvement, and the functional remission rate.

  Risks

  The placebo response rate in the Phase 3 NIU trial could fluctuate significantly, while failure of the Phase 2 PH-ILD or Phase 3 NIU trials and negative read-through from competitor IIM data could affect program value.

• Immunovant, Inc. (IMVT)

  The report maintains its forecasts, Market-Perform rating, and $37 target price, while monitoring multiple IMVT-1402 trials in autoimmune diseases.

  Strengths

  The upcoming Phase 2 CLE and Phase 2 D2T RA results are viewed by the report as attractive potential upside events.

  Weaknesses

  Current forecasts were not raised, and the target price is $37 versus a closing price of $44.96 on August 19, 2026.

  Risks

  Failure of the Phase 3 IMVT-1402 trials in Graves' disease or myasthenia gravis is explicitly identified as a downside risk in the report.

Key data

• BEACON+ Phase 3 Primary Endpoint≥50% improvement in CSAMI-A at Week 16Primary endpoint of the Phase 3 trial of brepocitinib in cutaneous sarcoidosis
• BEACON+ Phase 3 TimelineFirst patients enrolled; topline data expected in 2028Progress of the Phase 3 cutaneous sarcoidosis program
• Phase 2 Baseline CSAMI-AMean of 33.6 pointsOverall baseline disease activity level in the Phase 2 cutaneous sarcoidosis trial
• Mean Change in CSAMI-A at Week 1645mg arm: -22.2 points; placebo arm: -0.7 points; between-group difference: 21.6 pointsEfficacy of 45mg brepocitinib relative to placebo
• At Least 10-Point Improvement in CSAMI-A45mg arm: 100%; placebo arm: 14%Response rate at Week 16; 10 points equals twice the minimal clinically important difference
• CSAMI-A Below 5 Points45mg arm: 62%; placebo arm: 0%Percentage achieving what the report describes as functional remission at Week 16
• 45mg Arm Sample and Disease Durationn=13; mean disease duration of 10.2 yearsThis arm consisted of patients who were more difficult to treat and had a greater disease burden
• Brepocitinib Sales Start2028The previous model assumed 2027
• ROIV Revenue Forecast2026A: $8 million; 2027E: $30 million; 2028E: $315 millionAppendix financial model
• ROIV Diluted EPS Forecast2026A: -$0.43; 2027E: -$1.39; 2028E: -$1.55Forecast following the model adjustment
• ROIV Rating and Target PriceOutperform; $41Closing price was $37.40 on August 19, 2026
• IMVT Rating and Target PriceMarket-Perform; $37Closing price was $44.96 on August 19, 2026
• IMVT Cash and Marketable Securities Forecast2026A: $903 million; 2027E: $276 million; 2028E: $1.355 billion; 2029E: $1.067 billionAppendix balance sheet forecast
• IMVT Total Debt Forecast2026A: 0; 2027E: 0; 2028E: $1.5 billion; 2029E: $1.5 billionAppendix balance sheet forecast

Impact & implications

The report believes that the strong Phase 2 brepocitinib data reduce uncertainty surrounding the Phase 3 endpoint design and statistical-power assumptions in cutaneous sarcoidosis, although the program's commercialization timeline has been delayed by one year. Near-term research attention will focus on ROIV's catalyst-rich clinical events in the second half of 2026, particularly Phase 2 PH-ILD and Phase 3 NIU. Although the IMVT model remains unchanged, CLE and D2T RA data could still alter the assessment of program value.

Risks

• The placebo response rate in the Phase 3 immunology trial for NIU could fluctuate substantially, which management said may represent the trial's greatest risk.
• The Phase 3 NIU trial of brepocitinib could fail.
• The Phase 2 PH-ILD trial of mosliciguat could fail.
• Argenx's Phase 3 IIM results could have negative read-through implications for brepocitinib's opportunity in DM.
• The Phase 3 IMVT-1402 trial in Graves' disease could fail.
• The Phase 3 IMVT-1402 trial in myasthenia gravis could fail.
• Strong results from the Phase 2 IMVT-1402 trials in CLE and D2T RA could represent potential upside risks explicitly identified in the report.

What to watch

• Monitor the Phase 3 BEACON+ topline data for brepocitinib in cutaneous sarcoidosis, expected in 2028.
• Monitor Phase 2 mosliciguat results in PH-ILD in the second half of 2026.
• Monitor the Phase 3 brepocitinib results in NIU and the placebo response rate.
• Monitor Phase 2 IMVT-1402 results in CLE.
• Monitor second-stage IMVT-1402 data in D2T RA and regulatory discussions.
• Monitor the commercial launch in DM by September 2026 at the latest.
• Monitor the external read-through from argenx's Phase 3 IIM topline results for brepocitinib's opportunity in DM.