William Blair Maintains Outperform On Aratana Following AT-003 Positive Readout In Pilot Study


In a research report issued yesterday, William Blair analyst John Kreger maintained an Outperform rating on Aratana Therapeutics (NASDAQ:PETX), following yesterday’s news that the company’s AT-003, a Bupivacaine extendedrelease injectable suspension for managing postoperative pain in cats and dogs following surgery, resulted in positive efficacy in its pilot field study.

Kreger wrote, “We are supportive of the measured pace of development underway at Aratana, coupled with management’s extensive experience in development and commercialization. The recent disappointment out of Kindred Biosciences for CereKin (for the treatment of osteoarthritis in dogs) added to investor anxiety about the likely success rate for novel products in the companion animal market. So while today’s announcement is only pilot data, we view it as a useful reminder that Aratana is progressing on several fronts despite the stock’s underperformance of late. We view Aratana’s focus on investing in pilot studies prior to pivotal studies as a differentiating factor that gives us greater confidence that the pivotal studies will yield favorable and clinically useful data.”

Kreger continued, “We continue to anticipate discussions with the FDA on the design of the pivotal field effectiveness study before year-end. We are encouraged with this latest sign that AT-003 appears to be progressing on schedule. We model regulatory approval of AT-003 in 2016 and reiterate our Outperform rating on Aratana, based on recent stock price weakness.” Kreger added, “We expect the company to begin generating modest revenue in the fourth quarter of this year. As AT-005, the company’s conditionally licensed monoclonal antibody for the treatment of T-cell lymphoma, becomes commercially available to a limited number of clinics, we have modeled revenue generation for the company from this product beginning in the fourth quarter. Additionally, the company anticipates full licensure of AT-004, a conditionally licensed monoclonal antibody for the treatment of B-cell lymphoma, by the USDA before year-end.”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst John Kreger has a total average return of 9.6% and a 72.7% success rate. Kreger is ranked #1262 out of 3275 analysts.

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