BTIG analyst Tim Chiang weighs in on Synergy Pharmaceuticals Inc (NASDAQ:SGYP), following recent data that showed strong growth in weekly prescriptions for Trulance, the company’s chronic idiopathic constipation drug.
Based on our analysis of Symphony Healthcare prescription data, there were~976 total (~834 and and ~142 refills) prescriptions dispensed for the week ending May 26, 2017.
Chiang commented, “With Trulance weekly prescriptions approaching 1,000 per week, the product is now running ahead of our monthly forecasted projections for June. We believe we will see continued volume increases post the recent DDW meeting, which highlighted the product to more than 15,000 physicians.”
“For CY17, we estimate Trulance sales of ~$21.5M, which factors in a gradual initial ramp which begins to pick up steam in 2H17. We continue to believe that our longer-term peak sales estimate of ~$500M by 2022 is achievable, given the sizeable market opportunity (~40M patients in the US with chronic constipation). We believe Synergy has an experienced GI-focused sales force detailing Trulance to over 20,000 physicians in the US. Our prescription based Trulance sales model is shown in the table below. We factor in an estimated net price per prescription of ~$250, which factors in a 30% gross-to-net discount factor,” the analyst continued.
As such, Chiang reiterates a Buy rating on shares of Synergy Pharmaceuticals, with a price target of $11, which implies an upside of 172% from current levels.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Tim Chiang has a yearly average return of 11.8% and a 58% success rate. Chiang has a -11.5% average return when recommending SGYP, and is ranked #623 out of 4567 analysts.
Out of the 7 analysts polled in the past 12 months, 6 rate Synergy Pharmaceuticals stock a Buy, while 1 rates the stock a Sell. With a return potential of 198%, the stock’s consensus target price stands at $12.08.