Aegis Capital Downgrades Recro Pharma

Aegis Capital downgraded Recro Pharma Inc REPH Tuesday from Buy to Hold and did not set a price target.

Analyst Yi Chen noted that “Recro Pharma started a Phase 2 clinical trial of Dex-IN, its proprietary intranasal formulation of dexmedetomidine, in late October 2014 in the post-operative Day 1 setting for pain management following bunionectomy surgery.”

Regarding the current phase, Chen commented that “though theoretically the Day 1 setting should produce better efficacy than the Day 0 setting, investors ought to be cautious at this point, in our view.”

Chen cited a the previous Post Op Day 0 Phase 2 trial in September 2014 in which 95 received Dex-IN “with no serious adverse events, though four patients...discontinued due to symptomatic hypotension and one subject [discontinued] due to fever.”

With $23.9 million in cash at the end of September 30, 2014, Chen concluded “that the company shares currently trade at its cash value with a negative enterprise value. If the Day 1 Phase 2 trial reports positive data, the firm may need to raise additional capital by end-2015 for a Phase 3 trial.”

Recro Pharma Inc. recently traded at $2.77, down 4.57 percent.