pSivida Corp. (PSDVׂ) Shares Climb 10% – Here’s Why


pSivida Corp. (NASDAQ:PSDV) investors are excited today after the drug maker announced it has entered a collaboration agreement with Nicox S.A. to explore the potential of combining pSivida’s bioerodible sustained release drug delivery system with Nicox’s nitric oxide (NO)-donating compounds, to develop a sustained release drug to lower intraocular pressure (IOP) in patients with glaucoma or ocular hypertension.

pSivida shares reacted to the news, rising nearly 7% to $1.31.

pSivida and Nicox will collaborate on the selection of NO-donating product candidates from Nicox’s research portfolio to combine with pSivida’s sustained release drug technology.  pSivida will be responsible for initial development activities of ocular insert formulations, for which it will receive undisclosed sums by Nicox.  The companies may then elect to proceed with further development, including more detailed non-clinical studies to generate pre-clinical data, and the evaluation of further compounds under the collaboration.  Nicox would make additional payments for any incremental development activities for each implant formulation product candidate selected by Nicox to progress in development.  New intellectual property from the collaboration relating to the drug-device combination will be jointly owned.  Nicox and pSivida will negotiate a separate license agreement for any product candidate that the two companies wish to further develop and potentially commercialize as a result of this collaboration.  Expected payments from Nicox associated with this agreement are not considered material to Nicox’s financial statements at this time.

pSivida CSO Michael Bergamini, “We have strong pre-clinical data demonstrating the IOP lowering effect of our novel stand-alone NO donors, such as our lead NCX 667, and believe that their profile makes them product candidates for potential sustained release delivery.  The bioerodible technology in development by pSivida, combined with their proven success in developing sustained delivery devices for the eye, puts them at the forefront of this exciting area.”

CEO Nancy Lurker, “Nicox’s NO-donating research platform has been validated in both pre-clinical and human studies for the reduction of IOP […] Combining this novel approach to IOP lowering with our bioerodible, sustained delivery device could offer a unique therapy alternative or adjunct to existing therapies to lower IOP in order to help prevent the development and progression of glaucoma.”

On the ratings front, pSivida has been the subject of a number of recent research reports. In a report issued on September 27, H.C. Wainwright analyst Ram Selvaraju reiterated a Buy rating on PSDV, with a price target of $5, which represents a potential upside of 310% from where the stock is currently trading. Separately, on June 14, Northland Securities’ Suraj Kalia reiterated a Buy rating on the stock and has a price target of $10.

According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Ram Selvaraju and Suraj Kalia have a yearly average loss of 7.3% and a return of 7.6% respectively. Selvaraju has a success rate of 37% and is ranked #4632 out of 4693 analysts, while Kalia has a success rate of 59% and is ranked #853.

pSivida develops tiny, sustained-release products, which are designed to deliver drugs and biologics at a controlled and steady rate for weeks, months or years. The company through its technology platforms Duraser and Tethadur is focused on treatment of chronic diseases of the back of the eye and are also exploring applications outside ophthalmology. It is also developing a bioerodible, injectable micro-insert delivering latanoprost to treat glaucoma and ocular hypertension.