Largely dismissing investor skepticism questioning the viability of TherapeuticsMD Inc (NYSEMKT:TXMD) vaginal soft gel capsule TX-004, analyst William Tanner of Cantor is confident the drug will meet the FDA’s request in its recent General Advice Letter seeking additional endometrial safety data. While investors may have been disappointed with the rise of an approvability challenge in the FDA’s Complete Response Letter, notably, there was just one issue highlighted: not enough long-term safety data past the REJOICE trial.
Therefore, the analyst views the newest regulatory update from the firm as “sanity running amok,” finding the agency’s request a pertinent one that can shed promising light for TX-004. As far as the analyst is concerned, the request for new data will translate to a positive next step towards the drug’s approval in the indication of vulvar vaginal atrophy (VVA)- which Tanner approaches from a standpoint of bullish certainty.
Tanner opines that the FDA could not so simply turn around and approve the drug, noting: “Had the FDA executed a 180-turn from its previous opinion, we believe it would have essentially been a concession that the reviewers had made a mistake by not asking for 12-month endometrial safety data prior to approving the drug. Sure, asking for additional data would be a means of dotting the ‘i’s and crossing the ‘t’s, but we wonder whether there is also a face-saving element to it.”
Overall, the analyst assesses the situation favorably, believing “the drug could be approved, with a Class 1 review (two months), in early 2018.” Furthermore, “TXMD disclosed that the FDA’s recent General Advice Letter requested that the company submit additional endometrial safety data […] A tentative meeting has been scheduled for November 3 at which, presumably, TXMD will learn whether the data amply support the FDA’s request for additional data,” adds Tanner.
All things considered, the analyst did provide a word of caution that it’s “Not a fait accompli that the data will be viewed as adequate.” It remains unclear if the FDA intentions of reviewing the data is to “obtain the data underlying the analysis for which publication is pending, or whether a copy of the paper is sufficient.”
Therapeutics anticipates the FDA review of the new data will only take six weeks from the submission date. If this is correct, “A dimly lit path is becoming brighter,” cheers Tanner, who expects investors “should perhaps modify their viewpoint to a ‘when, not if’ perspective.”
The analyst reiterates an Overweight rating on TXMD with a $33.00 price target representing a 476% rise above Friday’s close. (To watch Tanner’s track record, click here)
TipRanks analytics demonstrate TXMD as a Strong Buy. Out of 5 analysts polled by TipRanks in the last 3 months all 5 are bullish on TherapeuticsMD Stock. With a potential upside of 242%, the stock’s consensus target price stands at $19.50.