Analysts Weigh In on Biotech Stocks Following Pipeline Updates and Earnings: AEterna Zentaris Inc. (AEZS) and Horizon Pharma PLC (HZNP)

Biotechnology stocks AEterna Zentaris Inc. (NASDAQ:AEZS) and Horizon Pharma PLC (NASDAQ:HZNP) take the center stage after analysts provide a pipeline update on a drug on track to be submitted for clinical trial application and highlight a slight Q4 earnings beat that was tampered by a government issued subpoena respectively. Below, analysts weigh in on both companies:

AEterna Zentaris Inc.

Maxim Group analyst Jason Kolbert reiterates a Buy rating on AEterna Zentaris Inc, a biotechnology company that develops therapies and medicines focused in oncology and endocrine therapy. Kolbert maintains a target price of $11.00. AEterna recently announced that Sinipharm, its licensee affiliated with the largest state owned pharmaceutical company in China, is on track to submit a clinical trial application for Zoptrex to the Chinese FDA in the summer of 2016. The analyst anticipates further clinical development later in this year. Sinopharm has additionally implemented the technology processes and is preparing to manufacture the compound.

AEterna announced that it has started promoting APIFINY, the only cancer specific non-PSA blood test for the evaluation of the risk of prostate cancer, in 20 U.S. territories according to its co-marketing agreement with Armune BioScience, a private company. Further, Armune BioScience will promote APIFINY to specified medical professionals and will receive a commission for reach test performed resulting from the targeted promotion.

Kolbert concludes by pointing up that AEterna’s lead product, Zoptrex, is in a pivotal phase 3 study in woman with advanced, recurrent, or metastic endometrial cancer who have progressed and already received SOC chemotherapy as with adjuvant or first line treatment. This study is expected to be completed in 3Q16. If the trials go well AEterna could file an NDA and MAA in 2017.

According to TipRanks, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Jason Kolbert has a yearly average loss of 17.7% and a 28% success rate. Ramsay is ranked #3670 out of 3738 analysts.

Horizon Pharma PLC

After Horizon Pharama PLC released earnings yesterday, Brean Capital analyst Difei Yang reiterates a Buy and a target price of $32. Horizon Pharma PLC is a specialty pharmaceuticals company that develops and markets medicine through its US subsidiaries.

Horizon’s Q4 beat the Street’s estimates after reporting $244.5 million in revenue versus the estimated $240.8 million. Non GAAP EPS was $0.63 which beat the street’s consensus of $0.62. Additionally, Horizon reached the upper-end guidance of $750-$760 million for 2015 revenue. Revenue growth can be attributed to strong sales or the company’s primary care drugs, specifically Duexis and Pennsaid, whose sales were up 2%. Duexis sales grew 110% y/y to $60.4 million and Pennsaid’s sales grew 26% q/q to $55.4 million.

Despite the earnings beat, shares of Horizon slid 13% after a subpoena from the US government was disclosed in the comapny’s 10K. The subpoena calls for more details on the HorizonCare program and marketing and commercialization strategies. Yang comments that it is “unclear that the investigation will go anywhere” at this point in time. While the investigation remains “background noise,” it remains an “overhang and time to resolution is unclear.” Despite the investigation, Yang expects the company’s operations, revenue, and profitability growth to “dominate in the longer term.”

According to TipRanks, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Yang has a yearly average loss of 19.9% and a 24% success rate. Ramsay is ranked #3648 out of 3738 analysts.

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