Ahead of Big Catalyst, AEterna Zentaris Inc. (AEZS) Announced Departure of Interim Chief Financial Officer


December is an exciting month for AEterna Zentaris Inc. (NASDAQ:AEZS) investors, with the upcoming PDUFA on December 30 for Macrilen (macimorelin), for the evaluation of growth hormone deficiency in adults (AGHD).

Ahead of the big catalyst, the tiny drug maker announced today the departure of Jeffrey Whitnell, the Company’s Interim Chief Financial Officer, effective December 7, 2017.  The Company is currently reviewing its resource requirements with respect to its finance department and has commenced a search for Mr. Whitnell’s replacement as principal financial officer.

Shares of Aeterna Zentaris are up nearly 2% to $2.21 in early trading Friday. AEZS has a 1-year high of $4.25 and a 1-year low of $0.78. The stock’s 50-day moving average is $1.99 and its 200-day moving average is $1.73.

On the ratings front, AEZS stock has been the subject of a number of recent research reports. In a report issued on November 29, H.C. Wainwright analyst Swayampakula Ramakanth reiterated a Buy rating on AEZS, with a price target of $3, which implies an upside of 39% from current levels.

Ramakanth wrote, “Macrilen is a diagnostic used for the diagnosis of adult growth hormone deficiency (AGHD), and in our view the potential approval of Macrilen on or before the PDUFA date could be a major catalyst for the stock. Over 37,000 patients under go testing for AGHD in the US each year and the insulin-tolerance test (ITT) is currently the standard diagnostic for this indication. However, ITT is also a time-consuming procedure with potentially severe side effects including palpitations, loss of consciousness and convulsions and costs an average of $2,000-3,000. Recall, while the Macrilen Phase3 study did not meet its predefined primary endpoint of agreement with ITT, according to a post-hoc analysis the study likely missed its endpoint due to the superior sensitivity of Macrilen as well as poorly-defined cut off points.”

Separately, on November 28, Maxim’s Jason Kolbert maintained a Buy rating on the stock and has a price target of $4.

Kolbert stated, “We believe Macrilen is an approvable product and we expect a positive outcome supporting approval, PDUFA December 30, 2017. We believe Macrilen could generate substantial revenue but even at a modest $50M in peak revenues and 3-5x revenues as a multiple, we see AEZS as deeply undervalued.”

According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Swayampakula Ramakanth and Jason Kolbert have a yearly average loss of -5.3% and -7.6% respectively. Ramakanth has a success rate of 34% and is ranked #4514 out of 4721 analysts, while Kolbert has a success rate of 34% and is ranked #4637.

Æterna Zentaris operates as a specialty biopharmaceutical company that is engaged in developing and commercializing novel treatments in oncology, endocrinology and women’s health. The company’s pipeline encompasses compounds at all stages of development, from drug discovery through to marketed products. It focuses on the development of Perifosine, Cetrotide, Ozarelix, AEZS-108 and AEZS-130.

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