A heavy-hitter catalyst is about to go up to bat for AcelRx Pharmaceuticals Inc (NASDAQ:ACRX) with a key FDA decision looming in the foreground, and all eyes are on the crowning judgement ahead. Tomorrow will be an imperative time for not only the biotech firm, but also the investors who back it. Will the FDA grant ACRX the golden ticket of years-long high hopes built on research, time, and high stake finances for its acute pain treatment Dsuvia?
Roth Capital analyst Michael Higgins remains bullish and sees a 20-50% increase in ACRX’s valuation on the news of its approval. Higgins believes ACRX is essentially a single-asset company with increasing visibility as a take-over candidate as it nears its October 12 PDUFA.
“We believe the performance of ACRX shares over the past few months can be attributed to the regulatory and commercial outlook for Dsuvia, with the increasing recognition that Grünenthal is likely to be interested in acquiring the European marketing rights to Dsuvia. While we aren’t modeling an equity raise in our models (through 2020), the upfront from a EU marketing partner may add 2x the upfront to AcelRx’s market cap as it would wipe out any near-term potential dilution. We believe the evidence for Grünenthal’s acquisition of Dsuvia’s EU rights is very strong, especially when considering its acquisitions and goals for corporate growth,” Higgins stated.
Higgins rates ACRX shares a Buy with a $12.50 price target, which implies a potential upside of 122% from where the stock is currently trading. (To watch Higgins’ track record, click here)
Echoing Higgins, H.C. Wainwright analyst Ed Arce opined, “We model FDA approval of Dsuvia in 4Q17 (PDUFA October 12), and Zalviso in 4Q18 (NDA submission on track for 4Q17). We also anticipate EU approval of Dsuvia in 1H18, though this represents upside to our model estimates as we await a partnership.”
Arce rates ACRX a Buy with a price target of $7.00, which represents a potential upside of 24% from where the stock is currently trading.
Wall Street backs Higgins’ and Arce’s bullish bite into the biotech player, as TipRanks analytics exhibit ACRX as a Buy. Out of 6 analysts polled in the past 3 months, 4 are bullish on AcelRx stock, while 2 remain sidelined. With a return potential of nearly 25%, the stock’s consensus target price stands at $7.10.