Cempra, Inc. (NASDAQ:CEMP) announced the receipt of a $10 millionmilestone payment from Toyama Chemical Co., Ltd. (Toyama) a subsidiary of FUJIFILM Holdings Corporation, triggered by Toyama progressing to Phase 3 studies with solithromycin in Japan, the world’s second largest antibiotic market.
Earlier this year, Toyama completed a Phase 2 multi-center, randomized, double-blinded study of 135 Japanese patients with mild to moderate community-acquired bacterial pneumonia (CABP). Patients were randomized to either oral solithromycin or oral levofloxacin for five days. Overall safety and tolerability was similar in both treatment groups and all efficacy outcome measures favored solithromycin.
The Japanese Phase 2 study was similar in design to the Phase 3 CABP studies conducted by Cempra in accordance with guidance from the United States Food and Drug Administration (FDA) and the European Medicines Agency (EMA).
Toyama owns exclusive rights to develop and commercialize solithromycin in Japan for respiratory tract infections and other indications in adults and pediatric patients.
In addition to the $10 million milestone payment for progressing to Phase 3, Cempra has also previously received $30 million of upfront and milestone payments and can earn an additional $30 million, for a total of $70 million, in payments from Toyama based on the achievement of certain objectives. If approved, Toyama would pay tiered royalties, adjusted based on sales, to Cempra following launch of solithromycin in Japan.
“Physicians in Japan currently have limited therapeutic options for CABP. We congratulate Toyama on their progress and have been very pleased to see the data generated by Toyama in their clinical studies are consistent with the data from Cempra’s clinical trials and support the strong value proposition of solithromycin for patients with CABP,” said Prabhavathi Fernandes, Ph.D., chief executive officer of Cempra. (Original Source)
Shares of Cempra are up nearly 1.5% to $18.40 in pre-market trading. CEMP has a 1-year high of $34.24 and a 1-year low of $14.03. The stock’s 50-day moving average is $23.56 and its 200-day moving average is $19.94.
On the ratings front, Cempra has been the subject of a number of recent research reports. In a report issued on October 28, Roth Capital analyst Michael Higgins reiterated a Buy rating on CEMP, with a price target of $34, which represents a potential upside of 88% from where the stock is currently trading. Separately, on the same day, Cowen’s Ritu Baral reiterated a Buy rating on the stock and has a price target of $31.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Michael Higgins and Ritu Baral have a yearly average loss of 14.7% and a return of 2.1% respectively. Higgins has a success rate of 29% and is ranked #3945 out of 4178 analysts, while Baral has a success rate of 34% and is ranked #1055.
Overall, 7 research analysts have given a Buy rating to the stock. When considering if perhaps the stock is under or overvalued, the average price target is $33.50 which is 84.8% above where the stock closed yesterday.
Cempra, Inc. engages as a clinical-stage pharmaceutical company, which focuses on the development of antibacterials to meet critical medical needs. Its antibiotic candidates includs Solithromycin and Taksta.