Roth Capital Starts Lipocine, Pieris Pharma With Buy Ratings Amid Enormous Market Opportunity

In separate reports published Wednesday, Roth Capital Partners analysts initiated coverage of Lipocine Inc LPCN and Pieris Pharmaceuticals Inc PIRS with Buy ratings. Lipocine has three oral, clinical-stage assets and is expected to file an NDA filing on its lead asset and start two Phase 2 trials on its other two pipeline assets around the end of this year. Transdermals comprises 90 percent of the testosterone (T) market. Therefore, analyst Michael Higgins believes that Lipocine's LPCN 1021, which is an oral, twice-a-day testosterone replacement therapy (TRT), is "on track to become the first landmark product in the category since the popular Androderm gel's launch in 2000." The company is also preparing for a Phase 2 trial with LPCN 1111, which is an oral, once-a-day TRT. Higgins commented, "Leveraging its unique drug delivery platform, the company is developing another first, an oral formulation of progesterone called LPCN 1107 which is to be used as a prevention of pre-term birth (PTB). Having secured the FDA's Orphan Drug Designation, LPCN 1107 would complete with Makena, which we believe may reach $300 million in 2015 revenues." Given that the company's cash is enough to fund operations beyond a mid-16 PDUFA and a marketing agreement likely in 1H16, Higgins believes that this is "an attractive entry point for investors." Roth Capital Partners has a price target of $36 for Lipocine. Analyst Elemer Piros mentioned in a report that Pieris had secured monopoly in "an entire biologic drug class, allowing the company to develop a multitude of treatments." Piros commented, "By owning the rights to the methods to develop biological drugs that could compete with monoclonal antibodies, Pieris is in a unique position to create drugs that are competitive and less expensive." The top three monoclonals are Rituxan, Avastin and Herceptin, which had combined sales of more than $22B last year and have "revolutionized cancer care." Humira, an antibody for arthritis, is "slated to become the biggest drug in history - $12.5B in sales in 2014," the report added. Pieris is pursuing its own internal drug candidates. Clinical proof-of-concept has been established in an oncology program. A trial in healthy volunteers would indicate initial efficacy for anemia in 2H15. "We currently ascribe a 30% probability of success for the treatment of anemia," Piros wrote. Roth Capital Partners has a price target of $7 for Pieris.
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Posted In: Analyst ColorInitiationAnalyst RatingsROTH Capital Partners
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