Roth Capital analyst Joseph Pantginis initiates coverage on shares of Sophiris Bio Inc (NASDAQ:SPHS) as the analyst provides a closer look at the biotech firm’s lead asset, PRX302, a pipeline single-injection drug guided into the prostate via ultrasound, with real possibility in addressing large markets of benign prostate hyperplasia (BPH) as well as localized prostate cancer (PCa).
In light of November 2015’s “positive Phase III in hand” for BPH, Pantiginis enters with a Buy rating and a price target of $8, which represents a nearly 181% increase from where the stock is currently trading.
“Our current valuation is based primarily on PRX302 for the improvement of symptomatic BPH ($7.89 per share NPV contribution). We have also included in our model the potential sales of PRX302 in localized prostate cancer, although contributing less to our overall price target ($0.25 per share NPV contribution) due to the earlier phase of development. Significantly impacting our valuation currently is a higher discount rate of 25%, which is based, in part, on anticipated further funding needs to bring PRX302 to Phase III completion, progressing the program in PCa and early commercialization costs,” Pantginis wrote.
On back of the phase three (PLUS-1) success, the analyst believes, “This puts PRX302 halfway to the finish line, and we believe that a confirmatory Phase III study that reproduces the PLUS-1 study would be sufficient for registration.”
Additionally, in June of 2016, the firm released results from a small proof-of-concept localized prostate cancer trial where several patients saw complete tumor ablation of targeted tissue, exhibiting the drug’s ability to “eradicate cancer cells.”
“We see both BPH and PCa as indications with significant unmet clinical needs, and view PRX302 as a complement to current surgical and non-surgical approaches. With a product now in late-stage clinical development and positive data in hand, we urge investors to consider the investment case ahead of upcoming catalysts,” Pantginis concludes.
According to TipRanks, which measures analysts’ and bloggers’ success rate based on how their calls perform, five-star analyst Joseph Pantginis is ranked #387 out of 4,151 analysts. Pantginis has a 36% success rate and yields 6.4% in his annual returns. ,
TipRanks analytics exhibit SPHS as a Buy. 100% of analysts polled in the last 3 months rate a Buy on SPHS. The consensus price target stands at $6.50, marking a 128% upside from where the shares last closed.