Oppenheimer analyst Jay Olson is out with a bullish research note on TherapeuticsMD Inc (NYSEMKT:TXMD), after a positive independent observational study conducted by the Women’s Health Initiative (WHI) on the pharmaceuticals’ lead drug TX-004HR. The drug is an applicator-free estradiol vaginal softgel capsule for the treatment of moderate-to-severe vaginal pain during sexual intercourse (dyspareunia). The WHI study, which targeted 93,000 patients, showed the drug has no adverse effect and gives additional weight to the upcoming FDA meeting with TXMD to reassess the drug.
Olson wrote, “We view these findings as positive for TX-004HR since the only approvability issue is a debate about the requirement of a long-term endometrial safety study. We believe that no pre-approval TX-004HR safety trial would yield insights that would be incremental to this large real-world dataset.”
The analyst further underlines the significance of the data noting “We believe that no pre-approval TX-004HR safety trial could provide the quality of this large real-world dataset. Additionally, TX-004HR PK data show no systemic estrogen exposure, in contrast to the typical PK profile of products allowed in the study.”
Moreover, Olson points to additional benefits of the drug, with the study showing “the risks of stroke, CHD, fracture, all-cause mortality, and GIE were lower in users.” Perhaps the only point of concern for the analyst is the potential for a box warning, which could discourage patients from using the drug pointing out that “Systemic estrogen is linked to increased risks of AEs, which has led to class labeling.”
Although the FDA had originally demanded an additional 12-month safety study in its CRL, Olson notes that “FDA will make a decision on whether the submitted data package can replace the 12-month safety study” allowing the company to “rapidly re-submit the TX-004HR NDA.”
The analyst is reiterating an Outperform rating on TXMD with a $10.00 price target representing a 59% rise over current trading levels. (To watch Olson’s track record, click here)
As of this writing, all the 5 analysts polled by TipRanks (in the past 3 months) rate TherapeuticsMD stock a Buy. With a return potential of 211%, the stock’s consensus target price stands at $19.50.