Growing CKD Prevalence Will Fuel Global Oral Therapy Adoption

Key Takeaways

• Rapid adoption of Vafseo and streamlined regulatory strategy could significantly expand market reach and drive superior revenue growth domestically and internationally.
  
• Strong product performance, cost control, and resilience in legacy products support ongoing R&D investment and improved financial stability.
  
• Revenue growth faces significant headwinds from pricing pressures, patent expirations, clinical risk, funding challenges, and limited expansion in a competitive, potentially shrinking CKD market.

Catalysts

A biopharmaceutical company, focuses on the development and commercialization of therapeutics for patients with kidney diseases.

• Analyst consensus recognizes that DaVita's rollout will drive growth for Vafseo, but the scale of prescribing access-rising from just 40,000 to over 275,000 dialysis patients in a matter of months-suggests a much steeper near-term revenue trajectory than widely modeled, with potential for Vafseo to rapidly dominate the U.S. market and set a new standard of care.
  
• While analysts expect non-dialysis CKD expansion to be a major growth factor, they may be underestimating the possibility of label expansion for Vafseo. The company's streamlined VALOR trial design and proactive engagement with the FDA could drive far faster entry into the substantially larger non-dialysis market, potentially multiplying Vafseo's addressable revenue base several times over by the end of this decade.
  
• Akebia's ability to drive strong adherence, increasing refill rates, and dose titration above initial expectations signals a foundation for superior revenue per patient and higher overall net margins, particularly as physician comfort and preference for oral therapies continue to rise across the CKD population.
  
• The global rise in CKD prevalence and increasing healthcare access in emerging markets present a long-term opportunity for Akebia to export Vafseo's differentiated, oral therapy profile internationally, unlocking sustained ex-U.S. revenue growth and long-term market share gains in the face of secular demographic tailwinds.
  
• Auryxia's unexpectedly resilient performance post-exclusivity, combined with Akebia's demonstrated cost discipline and reduced SG&A expenses, provides both a near-term cash engine and ongoing margin support, enabling self-funded R&D and pipeline expansion that could accelerate earnings growth and reduce financial risk relative to peers.

Akebia Therapeutics Future Earnings and Revenue Growth

Assumptions

• This narrative explores a more optimistic perspective on Akebia Therapeutics compared to the consensus, based on a Fair Value that aligns with the bullish cohort of analysts.
• The bullish analysts are assuming Akebia Therapeutics's revenue will grow by 22.7% annually over the next 3 years.
• The bullish analysts assume that profit margins will increase from -17.9% today to 33.6% in 3 years time.
• The bullish analysts expect earnings to reach $126.5 million (and earnings per share of $0.41) by about August 2028, up from $-36.5 million today. The analysts are largely in agreement about this estimate.
• In order for the above numbers to justify the price target of the more bullish analyst cohort, the company would need to trade at a PE ratio of 31.4x on those 2028 earnings, up from -23.2x today. This future PE is greater than the current PE for the US Biotechs industry at 15.1x.
• Analysts expect the number of shares outstanding to grow by 7.0% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 6.99%, as per the Simply Wall St company report.

Akebia Therapeutics Future Earnings Per Share Growth

Risks

• Increasing payer and regulatory pressures on drug pricing, combined with the complexity of reimbursement in the dialysis setting, could constrain the revenue Akebia is able to realize per patient, negatively impacting long-term revenue growth and net margins.
  
• The loss of intellectual property exclusivity for Auryxia and the imminent risk of additional generic competition may result in a sharp decline in Auryxia revenue, leading to significant pressure on future earnings.
  
• Akebia remains heavily reliant on vadadustat as its principal growth driver, so any adverse clinical or regulatory outcomes-particularly from the ongoing VOICE trial or the planned VALOR trial for non-dialysis CKD-could severely limit revenue expansion and cause a material decline in earnings.
  
• Rising cost of capital and a more challenging funding environment for small-cap biotech could hamper Akebia's ability to maintain robust R&D investment, threatening pipeline diversification and increasing the long-term risk of revenue cliffs.
  
• The CKD market's growth potential is constrained by possible secular demographic shifts-including plateauing or declining CKD incidence-as well as intensified competition from both generics and innovative therapies, which together could reduce Akebia's addressable market size and depress long-term revenues.

Valuation

• The assumed bullish price target for Akebia Therapeutics is $10.0, which is the highest price target estimate amongst analysts. This valuation is based on what can be assumed as the expectations of Akebia Therapeutics's future earnings growth, profit margins and other risk factors from analysts on the bullish end of the spectrum.
  
• However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $10.0, and the most bearish reporting a price target of just $6.0.
  
• In order for you to agree with the bullish analysts, you'd need to believe that by 2028, revenues will be $376.1 million, earnings will come to $126.5 million, and it would be trading on a PE ratio of 31.4x, assuming you use a discount rate of 7.0%.
  
• Given the current share price of $3.19, the bullish analyst price target of $10.0 is 68.1% higher.
  
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.