Emerging epilepsy treatment landscape: KOLs see substantial unmet need supporting novel epilepsy therapies, with tolerability and pivotal data as the key adoption tests.

Overview

This KOL update examines the evolving US epilepsy-treatment landscape across focal epilepsy and developmental and epileptic encephalopathies. Goldman Sachs reports constructive physician feedback on differentiated mechanisms and substantial unmet need, while identifying tolerability, pivotal-trial readouts and access as the major variables that will determine adoption.

Core views

The physicians described persistent unmet need in focal epilepsy: only approximately 25-30% of patients achieve seizure freedom despite numerous approved therapies, while roughly one-third remain refractory after multiple treatments. This creates an opening for therapies with differentiated mechanisms, but the KOLs stressed that real-world tolerability—especially neuropsychiatric adverse events—will ultimately determine use in refractory populations. For Rapport Therapeutics' RAP-219, the KOLs were encouraged by early efficacy and its TARPy8-selective AMPA-modulator mechanism. One physician suggested that selective cerebellar targeting could spare cortical and limbic structures and potentially reduce the anger, irritability, aggression and agitation historically associated with AMPA-targeted agents such as Fycompa. However, both physicians said a larger randomized Phase 3 focal-onset-seizure study is needed to validate the early profile. They also saw potential translation from focal-onset seizures to primary generalized tonic-clonic seizures, with Phase 3 initiation planned for 1H27. Ahead of October Phase 2 bipolar-mania data, psychiatric safety is an investor focus, although the physicians saw limited direct read-through to focal epilepsy because the underlying conditions differ. The KOLs were particularly positive on Xenon's Kv7/M-channel approach for refractory focal epilepsy. They noted that the mechanism may preferentially suppress pathological neuronal firing without being ubiquitously expressed across the brain, and regarded the approximately 50% seizure reduction and dose response reported for azetukalner as competitive with existing antiseizure-medication studies. One physician initially envisioned use mainly in the third-line-or-later setting and expected to use azetukalner in about half of refractory patients in its first year; the other expected interest from roughly one-half to two-thirds of patients. Both nevertheless emphasized monitoring psychiatric and behavioral effects and real-world tolerability. They viewed Biohaven's mechanistically similar program favorably as well, relative to historical GABAergic or AMPA-based approaches. In DEEs, the KOLs said Jazz's Epidiolex remains a meaningful part of care: one estimated that one-third to one-half of patients benefit through seizure reduction, tolerability and possible mood or behavioral calming effects, particularly after other medicines have failed. They expect the planned solid oral capsule to improve convenience versus the sesame-oil, strawberry-flavored liquid and potentially become the preferred formulation for adults who struggle with its volume or taste. For Praxis' relutrigine, physicians found the EMBOLD data in SCN2A- and SCN8A-DEEs encouraging and saw the state-dependent sodium-channel mechanism as potentially advantageous from a sodium-channel-toxicity perspective. They expect a possible translation into broader DEE populations in the ongoing Phase 3 EMERALD study, but adoption will depend on maintaining favorable tolerability in the larger trial. The KOLs indicated that a more modest placebo-adjusted seizure reduction than in EMBOLD could still support adoption if tolerability remains favorable, given that many DEE patients exhaust available options. The physicians were broadly enthusiastic about Stoke's zorevunersen and antisense-oligonucleotide platforms as targeted genetic therapies for DEEs. In Dravet syndrome, they viewed the potential to address underlying biology and restore gene function upstream of seizure generation as important because the potential benefit could extend beyond seizure reduction to developmental, cognitive, behavioral and functional outcomes. They considered intrathecal administration acceptable given disease severity and unmet need, though they would prefer alternative routes for future therapies. Goldman Sachs retains Buy ratings in the valuation discussions for the five named companies. JAZZ's $337 12-month target is based entirely on DCF using a 9% WACC and 1% terminal growth rate; PRAX's $575 target blends a $554 DCF value at 70% weight with a $625 theoretical M&A value at 30% weight. RAPP's $62 target blends a $54 DCF value at 70% and an $81 theoretical M&A value at 30%; STOK's $44 target uses an 85% weighting to $43 DCF and 15% to $47 theoretical M&A value; XENE's $75 target uses an 85% DCF weighting to $71 and 15% theoretical M&A weighting to $95. Across these names, the report highlights clinical, regulatory, commercial, reimbursement, competitive, execution and financing risks specific to their programs.

Analysis framework

Goldman Sachs hosted a discussion with two epilepsy physicians, using their clinical experience to assess unmet need, differentiated mechanisms, likely treatment positioning and practical adoption barriers. It then connects these views to named companies' trial programs and valuation frameworks, including DCF and, for selected companies, theoretical M&A values.

Methodology notes

• Industry AnalysisSupply-demand framework

  Unmet-need and treatment-adoption assessment

  The report uses the low seizure-freedom rate, refractory-patient burden and clinician treatment experience to assess demand for new epilepsy therapies and the conditions that could limit their uptake.

• Valuation methodsDCF (Discounted Cash Flow)

  Discounted cash flow valuation

  Goldman Sachs derives or partially derives several 12-month price targets by discounting projected cash flows using stated WACC and terminal-growth assumptions.

• Event-Driven and Behavioral FinanceEvent-driven analysis

  Clinical-trial and data-readout catalysts

  The report treats upcoming Phase 2 and Phase 3 data, including safety and tolerability outcomes, as decisive events for validating mechanisms and determining future adoption.

Asset mapping & comparison

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

• Jazz Pharmaceuticals (JAZZ)

  Covered company; Epidiolex is viewed as a meaningful DEE-care contributor, with capsule convenience potentially supporting adoption.

  Strengths

  KOLs cited benefits in seizure reduction, tolerability and possible mood and behavioral effects; the oral capsule may be preferred over liquid.

  Comparison

  The capsule is positioned as more convenient than the existing oral liquid solution.

  Risks

  Sales, supply, reimbursement or market-access disruptions; adverse events; clinical or regulatory setbacks; and competition following loss of exclusivity.

• Praxis Precision Medicines Inc. (PRAX)

  Covered company; relutrigine could become a new treatment option across broader DEEs if its profile translates in EMERALD.

  Strengths

  Encouraging EMBOLD data and a state-dependent sodium-channel mechanism that may offer a tolerability advantage.

  Weaknesses

  Broader-LEE efficacy and tolerability remain unproven in the larger EMERALD study.

  Comparison

  KOLs said lower placebo-adjusted seizure reduction than EMBOLD could still be acceptable if tolerability is maintained.

  Risks

  Regulatory restrictions or CRL, lower-than-expected unmet need or payer friction, EMERALD failure in broader DEEs, and EMBRAVE3 failure for relsunersen.

• Rapport Therapeutics (RAPP)

  Covered company; RAP-219 is a differentiated focal-epilepsy candidate requiring pivotal validation.

  Strengths

  TARPy8-selective AMPA modulation and encouraging early efficacy may reduce historical AMPA neuropsychiatric concerns.

  Weaknesses

  Early findings require confirmation in a larger randomized Phase 3 study.

  Comparison

  Selective targeting may compare favorably with less selective historical AMPA therapies such as Fycompa.

  Risks

  Failure to replicate results in Phase 3 FOS or Phase 2 bipolar-disorder studies, slow adoption, reimbursement failure, and regulatory, competitive, IP and financing risks.

• Stoke Therapeutics Inc. (STOK)

  Covered company; zorevunersen is viewed as a potentially disease-modifying genetic therapy for Dravet syndrome.

  Strengths

  Potential to address underlying biology and improve developmental and functional outcomes beyond seizure control.

  Weaknesses

  Requires intrathecal administration, while physicians would prefer alternative routes in future therapies.

  Comparison

  Unlike therapies focused only on seizure suppression, the approach aims to restore gene function upstream of seizure generation.

  Risks

  Failure in the Phase 3 EMPEROR seizure endpoint or secondary outcomes, payer resistance to pricing or disease-modification claims, and a smaller or harder-to-reach patient population.

• Xenon Pharmaceuticals Inc. (XENE)

  Covered company; azetukalner is a next-generation Kv7 treatment candidate for refractory focal epilepsy.

  Strengths

  Approximately 50% seizure reduction, dose response and a mechanism that may selectively suppress pathological firing.

  Weaknesses

  Initial expected use may be later line, with psychiatric and behavioral tolerability requiring monitoring.

  Comparison

  KOLs viewed its risk-benefit profile favorably against historical GABAergic or AMPA-based approaches.

  Risks

  Efficacy or safety may not translate from X-TOLE2 into X-ACKT, X-NOVA2 or later studies; the company may need partners for global commercialization or in-licensed assets to replenish its pipeline.

Key data

• Focal-epilepsy seizure freedom~25-30%Share of patients achieving seizure freedom despite numerous approved therapies, according to the KOL discussion.
• Refractory focal-epilepsy patients~one-thirdRoughly one-third remain refractory despite multiple therapies.
• XENE seizure reduction~50%Reported seizure reduction and dose response for XENE's Kv7 approach, viewed favorably versus existing ASM studies.
• Epidiolex beneficiary share1/3 to 1/2One KOL's estimate of patients benefiting through seizure reduction, tolerability or beyond-seizure effects.
• JAZZ 12-month price target$337100% DCF valuation using 9% WACC and 1% terminal growth rate.
• PRAX 12-month price target$57570% $554 DCF value and 30% $625 theoretical M&A value.
• RAPP 12-month price target$6270% $54 DCF value and 30% $81 theoretical M&A value.
• STOK 12-month price target$4485% $43 DCF value and 15% $47 theoretical M&A value.
• XENE 12-month price target$7585% $71 DCF intrinsic value and 15% $95 theoretical M&A value.

Impact & implications

The report argues that large unmet need can support uptake of differentiated epilepsy therapies, particularly in refractory focal epilepsy and DEEs. It indicates that the commercial opportunity will be shaped less by mechanism alone than by pivotal efficacy replication, tolerability—especially psychiatric effects—route of administration, reimbursement and the ability to reach suitable patients.

Risks

• Psychiatric and behavioral adverse events could constrain adoption of AMPA- and Kv7-based treatments despite promising efficacy.
• Larger pivotal trials must validate early findings for RAP-219, relutrigine, zorevunersen and azetukalner.
• Payer reimbursement, market access and patient identification could limit commercial uptake.
• Regulatory delays, restrictive labels, unsatisfactory trial outcomes and competition are cited as downside risks across the covered companies.

What to watch

• RAP-219 Phase 2 bipolar-mania data in October, with psychiatric safety and tolerability a key focus.
• RAP-219 randomized Phase 3 focal-onset-seizure validation and planned 1H27 Phase 3 initiation in primary generalized tonic-clonic seizures.
• The Phase 3 EMERALD readout for relutrigine, especially broader-DEE efficacy and maintenance of favorable tolerability.
• Initial real-world azetukalner experience, including psychiatric or behavioral events and prescribing uptake in refractory patients.
• Phase 3 EMPEROR results for zorevunersen, including seizure and secondary endpoints, and payer response to disease-modification claims.
• Availability and adoption of the Epidiolex oral capsule formulation.