Vertex Pharmaceuticals (NASDAQ: VRTX) is shifting some of its focus into providing drugs that will treat kidney diseases to diversify its portfolio.
The pharmaceutical company’s drug Povetacicept demonstrated positive results in a late-stage or phase 3 trial to treat chronic kidney disease. The medication was added to Vertex’s portfolio when it acquired Alpine Immune Sciences in 2024 for $4.9 billion.
The next step is receiving accelerated Food and Drug Administration approval for povetacicept, which treats IgA nephropathy that can result in renal failure. The phase 3 trial reported a 49.8% reduction in proteinuria compared with patients taking the placebo. Shares increased by 8% on March 10 after the promising news of the drug was released.
The company, which has a current market capitalization of $111 billion, said patients who used povetacicept reached a 52% reduction from the baseline in the amount of protein in their urine. High levels of protein often demonstrate that the filtering units in patients’ kidneys are either leaking or damaged.
The side effects reported by patients were injection site reactions and respiratory infections with the majority of people stating they were mild to moderate.
Shares of the pharma company fell by 12% during the past year, but rose by 7% in the past six months.
The positive news about the drug could bolster the company’s move into concentrating more on treating kidney diseases.
The results are “the first major step in unlocking the renal franchise,” said Carter Gould, an analyst for Cantor Fitzgerald. The renal treatment sector could reach $10 billion in peak sales, he estimated, giving Vertex a price target of $590.
Vertex could generate more revenue from its kidney drugs, said Cory Kasimov, an Evercore ISI analyst, according to a Barron’s article.
“Bigger picture, we see this readout as an important step forward in the company’s push to become a nephrology powerhouse,” he said. The promising results of the trial were also a “pretty good validation” of Vertex’s purchase of Alpine Immune Sciences, Kasimov added, giving Vertex a price target of $530 a share.
Pivoting to offering medications to treat kidney diseases will help Vertex, which is known for providing drugs to treat cystic fibrosis, diversify its pipeline and boost its revenue.
If Povetacicept receives FDA approval, the drug “could reach blockbuster sales potential and generate more than $1 billion annually by 2030,” since there are an estimated 330,000 patients in the U.S. and Europe, is roughly 330,000, and there are over 1.5 million patients globally, wrote Rachel Elfman, an equity analyst for Morningstar.
Since Vertex used a priority review voucher to expedite the approval process for povetacicept, the pharmaceutical company could receive approval by the FDA by November 2026 and launch the drug by early 2027, Elfman wrote.
Vertex’s competitor, Otsuka Pharmaceutical’s drug Voyxact, has an annual list price of $390,000. Povetacicept could receive a similar price, she wrote.
Non-opioid painkiller revenue could skyrocket
The company’s next-generation painkiller, Journavx, a non-opioid painkiller, is also likely to have the potential to generate hundreds of millions of dollars since it was approved by the FDA in January 2025. The drug is the first new non-opioid painkiller approved in the US in more than 20 years.
Revenue for Journavx is predicted to reach $250 million in 2026 since management “aims to triple Journavx prescriptions in 2026 from 550,000 in 2025, supported by a broader prescriber base, expanded coverage, and patient discounts,” Elfman said.
Journavx could generate 10% of the company’s total revenue by the end of Morningstar’s 10-year forecast period due to its large “addressable market,” she wrote. “However, we see near-term headwinds given its $15.50 per pill price versus low-single-digit opioids. Maintained growth will require wider payer coverage, greater use across pain settings, and fewer discounts.”
The pharmaceutical firm has depended on its “robust” cystic fibrosis franchise, which includes the drug Kalydeco, Orkambi, Symdeko, Trikafta, and Alyftrek, to generate 98% of 2025’s revenue of $12 billion, Elfman added. Vertex’s cystic fibrosis drugs treat about 90% of the 83,000 patients who have cystic fibrosis worldwide.
Vertex’s strategy to expand into treating pain and kidney diseases appears to be the right path for the company to diversify its revenue and boost profit margins.
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