La Jolla Pharma Is A 'Top Pick' For This Analyst

In a report published Monday, Chardan Capital Markets analyst Gbola Amusa maintained a Buy rating on La Jolla Pharmaceutical Company LJPC, with a price target of $60.

Analyst Gbola Amusa commented, “Post Q2 results, we update our model, accounting for a pick-up in expenses due to the successful start of phase I/II trials for LJPC-501 in hepatorenal syndrome and LJPC-401 in hereditary hemochromatosis (chronic iron overload).”

The EPS estimates for 2015 and 2016 and 2017 have been reduced from -$2.16 to -$2.85 and from -$2.27 to -$3.01, respectively. The EPS estimate for 2017 has been raised from -$2.98 to -$2.62.

Amusa said that La Jolla was a “top pick” in view of the “multi-layered optionality from upcoming catalysts.” These were enumerated as:

• Option 1: LJPC-501 could achieve a penetration of 60-100 percent in the catecholamine-resistant hypotension market. This suggests a price target of $110 to $200+, “with further upside and operating leverage possible if the LJPC-501 price were greater than $15,000.”
• Option 2: Phase I/II data for LJPC-401 in hereditary hemochromatosis, or chronic iron overload, is expected in the back half of this year. Positive data could result in a price target upside of $24.
• Option 3: Phase I/II data for LJPC-501 in hepatorenal syndrome, or HRS, is expected in the back half of this year. While the final phase III CRH data for LJPC-501 is expected in 2H16, positive phase I/II data could lead to further upside.