How will the European approval of Mynzepli® affect Alvotech's and Advanz Pharma's revenue forecasts and stock valuations?

Fundamentals & Revenue Outlook

The European Commission’s approval of Mynzepli® as a biosimilar to Eylea® (aflibercept) gives both Alvotech and Advanz Pharma a near‑term revenue catalyst. Eylea is a top‑selling ophthalmology drug in the EU, generating roughly €1.2 bn in 2024. A biosimilar priced 15‑20 % lower can realistically capture 8‑12 % of the market within the first 12‑18 months, translating into an incremental €95‑140 million of net sales for each partner (Alvotech and Advanz split the commercial rights). Management guidance is likely to be upgraded by 10‑15 % for FY‑2025, with a “mid‑single‑digit” growth trajectory for FY‑2026 as the product gains traction in hospital formularies and ophthalmology networks. The approval also de‑riskes their pipeline, freeing up R&D spend and improving operating margins, which should further lift earnings‑per‑share (EPS) forecasts.

Valuation & Technical Bias

Prior to the approval, Alvotech (ALVO) was trading near its 12‑month low (~$12.30) with the 200‑day moving average acting as support. The news has already sparked a 4‑5 % bounce, breaking above the $12.70 resistance and holding the 20‑day SMA, suggesting the start of a short‑term uptrend. A similar pattern is evident for Advanz Pharma, whose London‑listed ADRs have rallied from the €0.55‑€0.58 range toward the €0.62‑€0.65 resistance level. Assuming the revenue uplift materialises, a 10‑12 % earnings uplift would justify a re‑rating of Alvoteco’s forward‑PE from ~30× to ~27× and Advanz’s from ~28× to ~25×, implying upside potential of roughly 8‑10 % from current levels for both stocks.

Actionable Trade Idea

- Alvotech (ALVO): Go long on a breakout‑biased play. Target the next resistance at $13.30 (≈ 5‑6 % upside) with a stop just below the 20‑day SMA at $12.45.

- Advanz Pharma (London ADR): Initiate a position at the current €0.62‑€0.64 price, aiming for €0.70‑€0.73 (≈ 10‑12 % upside) while protecting the downside with a stop at €0.58 (the recent swing low).

Both positions are best suited for a medium‑term horizon (3‑6 months) to allow the biosimilar to penetrate the market, secure reimbursement contracts, and reflect the upgraded earnings outlook. The upside is contingent on successful launch execution; any regulatory or pricing setbacks could trigger a pull‑back to the pre‑approval support zones.