BTIG Positive on Synergy Pharmaceuticals Inc (SGYP) Ahead of Upcoming FDA Decision


Synergy Pharmaceuticals Inc (NASDAQ:SGYP) investors are eagerly awaiting the FDA’s decision on plecanatide’s (for the treatment of chronic idiopathic constipation) new drug application, which should be out on January 29. According to BTIG analyst Tim Chiang, the drug maker should receive approval with a clean product label.

As such, the analyst reiterates a a Buy rating on SGYP, with a price target of $11, which represents a potential upside of 68.5% from where the stock is currently trading.

Chiang noted, “We think SGYP’s launch in early 2017 will be targeted at ~20,000 to 25,000 physicians who are high prescribers of Rx treatments in CIC (which account for ~70% to 80% of the prescriptions written in the US market), with the Co. utilizing a contract-sales force (Touchpoint) that numbers between 150-200 reps. As a result, we think SGYP’s annual marketing costs for plecanatide will be substantially below what Allergan (AGN, Not Rated) and Ironwood (IRWD, Buy, $18 PT) spend (~$250 million per year) combined on the marketing of Linzess in the US.”

“In 2017, we expect sales for Rx treatments to exceed $2 billion. In 2016, Allergan / Ironwood’s Linzess volumes increased by more than 20%, according to our analysis of Symphony Healthcare prescription data,” the analyst added.

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Tim Chiang has a yearly average return of 17.3% and a 59% success rate. Chiang has a 45% average return when recommending SGYP, and is ranked #274 out of 4350 analysts.

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