Analyst Note
| Karen Andersen, CFA |Grifols' first-quarter results were in line with our estimates on the top line and above our estimates on the bottom line, as Grifols has managed to hold profitability relatively steady despite COVID-19-related plasma supply constraints. We're maintaining our $23/EUR 19 fair value estimate for class B shares. Beyond the pandemic, we continue to view Grifols as holding a narrow moat, despite new competition from FcRn drugs like Argenx's efgartigimod, which is on track for U.S. approval in its first autoimmune indication, myasthenia gravis, by the end of 2021. We expect this new class of drugs will leave Grifols and other leading plasma players with significant remaining immunoglobulin demand in patients who will not be eligible for the new treatments, with some autoimmune sales and also the core business for immune deficiency patients (roughly half of current immunoglobulin sales) likely to be preserved longer term. We're also encouraged by continued strength in other plasma-derived protein franchises, including albumin (China) and alpha-1 antitrypsin (in the U.S. and Europe).