Valeant Pharmaceuticals Intl Inc
Analyst Ram Selvaraju of Rodman & Renshaw was out with a research note on shares of Valeant Pharmaceuticals Intl Inc (NYSE:VRX) after the drug maker released its second-quarter results and reaffirmed its guidance for 2016.
Valeant reported adjusted cash EPS of $1.40 and revenue of $2.42 billion, compared to Selvaraju’s expectations of EPS of $1.51 and revenue of $2.435B. Though earnings and revenue come across as “a little light” for the analyst, Valeant has reaffirmed its financial guidance for 2016 of a revenue range from $9.9 billion to $10.1 billion and adjusted cash EPS in a range from $6.60 to $7.00.
In light of this, Selvraju reiterates a Buy rating on VRX, but reduces his price target from $90 to $81 per share, which represents a close to 188% upside from where the stock is currently trading.
Selvaraju comments, “In our view, Valeant is taking a measured and rational approach to targeted divestitures of non-core businesses. The divestment of the Synergetics U.S. OEM business, the return of the brodalumab European rights to AstraZeneca (AZN; not rated) and the recentlyannounced return of U.S. rights for Ruconest to Pharming Group N.V.—which brought in $181M in upfront cash and potential future milestones of $329M—constitute logically structured transactions that do not, in our view, impair Valeant’s base business.”
The analyst has every expectation that the firm will continue to pursue these sales targeting non-core products as long as prices remain obtainable and fair. Meanwhile, Selvaraju finds Valeant has also sustained its commitment to resolving debt for hopes to achieve greater financial flexibility. As such, for Selvaraju, there is no real risk in sight of debt default.
As usual, we recommend taking analyst notes with a grain of salt. They are often successful in moving the stock price, but you always need to take things into perspective. According to TipRanks, two-star analyst Ram Selvaraju is ranked #2,838 out of 4,105 analysts. Selvaraju has a 43% success rate and loses 0.1% in his annual returns. However, when recommending VRX, Selvraju earns 9.5% in average profits on the stock.
TipRanks analytics exhibit VRX as a Hold. Based on 17 analysts polled by TipRanks in the last 3 months, 5 analysts rate a Buy on VRX stock, while 9 maintain a Hold, and 3 issue a Sell. The consensus price target stands at $39.96, marking a nearly 42% upside from where the shares last closed.
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Inovio Pharmaceuticals Inc
In addition, Rodman & Renshaw’s Ram Selvaraju weighed in on shares of Inovio Pharmaceuticals Inc (NASDAQ:INO), after the company reported second-quarter results. With pipeline drug approval within reach, a new Phase 3 study starting soon, and a strategy bolstered by three drug candidates, Selvaraju reiterates a Buy on INO with a $17 price target, marking a nearly 93% increase from where the stock is currently trading.
Worthy of note, management has discussed the affirmative path provided by both the FDA and the European Medicines Agency (EMA) for its pipeline drug VGX-3100 to treat HPV-16/18-related high grade cervical dysplasia in a pivotal Phase 3 registration study. After having both completion of commercial device design for the drug as well as manufacturing process development efforts underway, the drug maker is in prep mode for submitting the final package to the FDA in the upcoming weeks, with full expectation for first dosing to commence by fourth quarter.
Management has also discussed that this Phase 3 trial will likely enroll around 350 patients at 150 sites worldwide, with a similar efficacy endpoint to that in the Phase 2 study. Selvaraju comments, “This is encouraging news, in our view, together with the fact that it has been 1.5 years since 160 patients received their first dosing of VGX-3100 in the Phase 2 study and no significant adverse events have been observed thus far.”
Another positive factor weighing in INO’s corner is the presentation of a new plan called Inovio Vision 2020, set to have three drug candidates ready for registration in 2020. Of course, not at all surprising to the analyst, the first candidate ready will be VGX-3100. The second one will be a cancer-treating candidate, potentially new candidate, INO-5400, a multi-antigen immunotherapy to be used in combination with checkpoint inhibitors.
Meanwhile, Inovio’s PENNVAX®-GP HIV immunotherapy is set to deliver Phase 1 data by 1H 2017. Selvaraju believes, “These data readouts in the coming quarters could drive further upside in the stock, in our view.”
Additionally, Inovio’s total revenue for the quarter was $6.2 million, above Selvaraju’s projection, which the analyst attributes to a surge in development payments from the firm’s DARPA Ebola grant. The company saw a net loss of $18.7 million during the quarter, or ($0.26) per share.
TipRanks analytics exhibit INO as a Strong Buy. Based on 4 analysts polled in the last 3 months, 3 rate a Buy on the stock and 1 maintains a Hold. The consensus price target stands at $17.50, marking a 97% upside from where the shares last closed.
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Synergy Pharmaceuticals Inc
Rodman & Renshaw analyst Ram Selvaraju also gave his two cents on Synergy Pharmaceuticals Inc (NASDAQ:SGYP), after the biotech firm reported second-quarter financial results as well as declared completion of over 95% for patient enrollment in its two pivotal Phase 3 constipation-predominant irritable bowel syndrome (IBS-C) clinical trials. Feeling positive on plecanatide IBS-C data as a next value driver for Synergy, Rodman & Renshaw analyst Selvaraju reiterates a Buy rating on SGYP with a $15.00 price target, marking a 216% increase from where the shares last closed.
Selvaraju believes that in light of the timeline with both IBS-C Phase 3 studies due by fourth quarter, Synergy will likely file for approval of plecanatide in the IBS-C indication sometime by the close of 2017’s first quarter. Meanwhile, the pipeline is already under FDA review with a pending PDUFA approval decision due January 29, 2017 evaluating the drug in context of the treatment of chronic idiopathic constipation (CIC).
Selvaraju notes, “Synergy remains highly confident on the plecanatide CIC NDA’s likelihood of approval, and reiterated in yesterday’s press release that the FDA had indicated no need for an advisory panel vote on plecanatide for CIC. Further, we believe the FDA considers plecanatide a valuable potential addition to the CIC treatment armamentarium because of its safety advantages vs. the only currently-marketed guanylyl cyclase C (GC-C) receptor agonist, linaclotide, and thus we remain optimistic on plecanatide’s likelihood of timely U.S. approval for the CIC indication.”
Tipranks analytics exhibit SGYP as a Strong Buy. Based on 4 analysts polled in the last 3 months, all 4 rate a Buy on Synergy. The 12-month average price target stands at $11.38, marking a 136% upside from where the stock is currently trading.
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Ionis Pharmaceuticals Inc
Finally, Cowen top analyst Eric Schmidt reiterated a Market Perform rating on shares of Ionis Pharmaceuticals Inc (NASDAQ:IONS), after the company posted second-quarter financial results and provided a clinical progress update.
Though remaining neutral on Ionis, Schmidt does feel positive on its main pipeline drug nusinersen, an investigational drug designed to treat spinal muscular atrophy (SMA). IONS and its partner Biogen (BIIB) are expected to submit global regulatory filings on the drug for SMA in the near-term. Meanwhile, three Phase III trials are anticipated to release data by the end of H1:17, including TTR-Rx for FAP, volanesorsen for FCS and nusinersen in Type 2 SMA. Schmidt affirms, “Our confidence remains highest in nusinersen’s developmental and commercial success.”
Just last week, IONS and BIIB indicated a positive interim analysis of Phase III ENDEAR study for nusinersen in infantile-onset Type 1 SMA. Following the success of this analysis, the trial was ended early with Biogen now choosing to exercise its option on the drug. The biotech leaders intend to bring nusinersen to patients suffering from SMA as quickly as possible, readying for both U.S. and EU regulatory submission, with the objective to apply for Breakthrough designation in the U.S. and accelerated assessment in the EU.
Schmidt believes, “Ionis Pharmaceuticals has validated its antisense platform by successfully shepherding systemic antisense drugs to commercial feasibility. We believe antisense candidates have the best chance of success when directed at treating orphan diseases that lack treatment alternatives. Prime examples within Ionis’s pipeline include candidates for spinal muscular atrophy (SMA), TTR amyloidosis, and familial chylomicronemia syndrome (FCS).”
However, Schmidt acknowledges the problem arises with not one, but two of the firm’s three leading candidates having encountered safety issues, specifically with cases of severe thrombocytopenia. From the analyst’s standpoint, this has not simply damaged crucial prospects for the company, but also has shrouded other opportunities in development in a cloud of skepticism, leaving him cautious on the future of IONS.
Additionally, Ionis reported second-quarter revenue of $38.5MM, compared to Schmidt’s expectation of $28MME. Ionis hit a GAAP Net Loss of $56.9MM, compared to the analyst’s estimate of $72.5MME. The firm closed the quarter with $664MM in cash flow, reiterating its financial guidance for 2016.
According to TipRanks, Eric Schmidt is a top five-star analyst, having reached a high ranking of #56 out of 4,110 analysts. Schmidt sustains a 55% success rate and realizes 22.2% in his yearly returns. When recommending IONS, Schmidt earns 61.4% in average profits on the stock.
TipRanks analytics demonstrate IONS as a Buy. Based on 8 analysts polled by TipRanks in the last 3 months, 4 rate a Buy on Ionis shares, 3 maintain a Hold, and 1 issues a Sell. The 12-month average price target stands at $37.17, marking a 3% upside.
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