On June 2, Wedbush analyst Liana Moussatos published a list of upcoming catalysts for emerging pharmaceuticals, specifically for Intercept Pharmaceuticals Inc (NASDAQ:ICPT), Receptos Inc (NASDAQ:RCPT), and Omeros Corporation (NASDAQ:OMER). Events such as new data emerging from a trial or New Drug Application filings can have a significant impact on stocks in this volatile sector.
In the second half of 2015, Moussatos expects Intercept Pharmaceuticals Inc to file a New Drug Application for OCA in PBC. Obeticholic acid, or OCA, is a treatment for patients with the liver disease PBC. The drug has received fast-track designation in the United States and orphan drug designation in both the U.S. and Europe. Moussatos sees a 60% chance for approval for the drug by the end of 2015 or the first quarter of 2016. Moussatos remains bullish on Intercept for several reasons, such as the belief that clinical success for OCA “appears likely.” Furthermore, the analyst notes, “regulatory risk appears reasonable and continues to decline—especially with FDA granting Breakthrough Therapy Designation ” to OCA. Lastly, she notes that the commercial risk of OCA is “below average.” If approved, Moussatos believes the “barriers to commercial adoption will be relatively low as many patients have been identified and are receiving treatment.”
Liana Moussatos reiterated an Outperform rating on Intercept Pharmaceuticals with an acquisition value of $493. She has rated the stock 17 times since April 2013 earning a +78.5% average return per ICPT rating.
Looking forward, Liana Moussatos also sees several catalysts for Receptos. She estimates that full results from the maintenance portion of the TOUCHSTONE trial will be available this year. The TOUCHSTONE trial tests RPC1063, a pipeline drug for inflammatory bowel disease. The analyst notes that this treatment carries a “lower than normal” clinical risk. In early May, Receptos announced positive Phase 2 induction results for the TOUCHSTONE trial and noted that ongoing clinical trials for the drug are enrolling on schedule.
Liana Moussatos reiterated an Outperform rating on Receptos with a $211 price target. She has rated the stock 14 times since June 2013, earning a +109.1% average return per RCPT rating.
Turning her attention to Omeros Corporation, Moussastos is 85% confident of the potential EC approval of Omidria in July. Omidria was approved by the FDA in May 2014 for use during cataract surgery or intraocular lens replacement as a means to maintain pupil size during the surgery. Moussastos recommends the company because it is “advancing a broad pipeline of inflammation and neurological treatment candidates ranging in development stage from FDA approved OMIDRIA™ to Phase 2 to preclinical and the ability to generate in-house new drug candidates from their state-of-the-art drug discovery platforms, which strengthens their intellectual property.” She believes Omeros’s pipeline does not carry so much risk due to its diversity. On May 22, Omeros announced that the European Medicines Agency’s Committee for Medicinal Products for Human Use developed a positive opinion on Opindria. Moussastos notes, “there was no baggage in the CHMP recommendation” and “anticipate[s] full approval of Omidria by the European Commission (EC) is likely to occur in July and provide a catalyst for the stock.”
Liana Moussastos maintained an Outperform rating on Omeros with a $61 price target. She has rated the stock 16 times since March 2012, earning a +40.8% average return per OMER rating.
Overall, Liana Moussastos has a +37.3% average return per rating.