Analysts are eager to weigh in on biotech giant Keryx Biopharmaceuticals, Inc. (NASDAQ:KERX) after new earnings results and Lipocine Inc. (NASDAQ:LPCN) after the company’s pipeline drug got a leg up on a competitor.

Keryx Biopharmaceuticals, Inc.

Keryx posted its 3Q15 earnings report on October 29, prompting analyst Jonathan Aschoff of Brean Capital to maintain a Buy rating on the stock with a price target of $18.

The biopharmaceutical company reported 3Q15 total revenue of $4.2 million, well over the consensus of $3.8 million. Aschoff explained, “The beat (is) mostly due to the more than typical fraction of sales made through the DaVita Rx and Fresenius Rx pharmacies, which are not captured by IMS;” the service that provides information on prescriptions.

US net sales of Auryxia, Keryx’s lead product used in patients undergoing dialysis for kidney disease, were $3.2 million, based on approximately 5,350 prescriptions filled in 3Q15, marking a 45% sequential increase in unit volume compared to 2Q15. Keryx started a sample program in May to target physicians who have not yet written an Auryxia prescription. Aschoff estimated, “Keryx is on track with its sample program, and we expect a faster uptake in Auryxia sales as the starter kit pill count drops from 200 to 50.”

Keryx reported a pro-forma cash balance of $227.2 million. The company also implemented a cost reduction plan which will have minimal impact in 4Q15. Aschoff explained, ‘We believe with the current cash position and the cost reduction plan, Keryx should have enough cash to fund itself to cash flow positivity.” Further, Keryx decided to add 35 sales reps during 4Q15, which will offset the cost reduction measures.

Aschoff has rated Keryx 17 times with a success rate of 24% and an average loss of -16.2% per recommendation when measured over a one-year horizon. Overall, he has a 42% success rate recommending stocks with a -3.0% average loss per recommendation. Out of 8 analysts polled by TipRanks who cover Keryx, 3 have recommended a Buy, 4 analysts are on the sidelines, while 2 analysts are bearish on the stock with a Sell rating. The average 12-month price target for the stock is $9.50, marking a 112.05% potential upside from last closing price.

KERX consensus

Lipocine, Inc.

Lipocine Inc., a specialty pharmaceutical company, has been in the news related to LPCN 1021, the company’s oral product candidate for testosterone replacement therapy. Last week, the NDA for LPCN 1021 was accepted by the FDA. Incidentally, on the same day, the FDA cancelled a scheduled meeting for Androxal, a competitor product from Repros Therapeutics. This cancellation is seen as a setback for Androxal, and a positive for LPCN 1021. Following these developments, Corey Davis from Canaccord Genuity weighed in on the stock, reiterating a Buy rating on the stock while keeping the price target of $15 unchanged.

Davis is confident that the Repros’ encounter is not applicable to Lipocine. One of the reasons behind this is the difference in the types of patients targeted by both these drugs. While Androxal is targeted at “secondary hypogonadism in overweight men who wish to restore normal testicular function,” LPCN 1021 is targeted towards general hypogonadism. Also, LPCN 1021 has successfully met the “FDA-guided primary efficacy point of percentage of treated patients who achieve a total testosterone concentration of (Cavg) between 300 and 1140 ng/dL.”

Sharing his methodology about the valuation, Davis says he arrived at the price target by applying a 20x multiple to his 2021 EPS estimate of $2.06 discounted by 20% for 5.5 years. According to him, some of the risks to this price target include failure of LPCN 1021 to gain FDA approval, failure to find a partner and/or failure to sell the company.

Davis has rated LPCN’s stock twice; based on these ratings he has a success rate of 100% for the stock, while earning an average return of 23.7% on the stock. Of the two analysts on TipRanks who have recently rated Lipocine, both of them are bullish on the stock with no bearish sentiments. The average consensus price target for the stock is $25.5, an upside of 113.21% over current levels.

LPCN consensus