In a research report sent to investors today, Brean Capital analyst Jonathan Aschoff reiterated a Sell rating on Rockwell Medical (NASDAQ:RMTI) with a $4.00 price target, following this morning’s news that the FDA approved the company’s Triferic as an iron replacement product to maintain hemoglobin in CKD patients on dialysis.
Aschoff noted, “We expect dismal commercial uptake for Triferic following approval. Although the Triferic label has not become available, there was no mention of ESA sparing effects with Triferic in Rockwell’s press release, making it clear to us that ESA sparing is not a label claim. Without ESA sparing effects on the label, Triferic is just a substitute for IV iron, and is not justified to command premium pricing compared to IV iron, in our view.”
The analyst continued, “As an IV drug without ESA sparing benefits, Triferic will not improve dialysis center margins, and dialysis centers have already shown that their choice of drugs under bundled reimbursement is in large part driven by economics. We also see no safety advantages with Triferic. Triferic was tested in a Phase 3 trial against a control group that has nothing whatsoever to do with a dialysis center’s activities and thus has yielded data that are both uninterpretable and uninformative to doctors. This underpins our strong view that demand for Triferic will be minimal. The rubber now meets the road for Triferic, and all we hear is a skid and a crash.”
Rockwell Medical, Inc. operates as an integrated biopharmaceutical company in the United States and internationally. It offers products and services for the treatment of end-stage renal disease, chronic kidney disease (CKD), iron deficiency, secondary hyperparathyroidism, and hemodialysis.