This Analyst Loves Depomed And Its Nucynta Prescription

In a report issued Friday, Roth Capital analyst Scott R. Henry provided an update of prescriptions for Nucynta, a franchise recently acquired by Depomed Inc DEPO, which he believes is now the primary fundamental focus for the company’s investors.

The firm anticipates flattish trends to start accelerating in the second half of the year (although with higher pricing), and sees this week's data as in-line with expectations. Notably, the prescriptions data for the entire month of July shows that Nucynta ER is experiencing an upward bounce in market share (“a trend worth watching in coming weeks/months,” Henry added).

While Nucynta IR prescriptions are still falling, Roth seems optimistic about the future. The report noted that Depomed did not begin to actively manage Nucynta until June 2015. The firm now targets comps to improve, as the company “increases marketing of the product with flat-to-modest growth by 3Q16.”

Roth’s expectations are pretty much the same for Nucynta ER, even though – opposite to Nucynta IR – it continues to see the number of prescriptions rising.

What To Watch For

Analysts at Roth Capital “are monitoring Nucynta script trends pending the transition to the DEPO internal salesforce. More importantly, shares are currently being driven by an unsolicited all-stock buyout proposal from Horizon Pharma PLC HZNP.”

The firm maintains a Buy rating and $33.00 12-month price target on shares of Depomed.

Shares of Depomed are down more than 1 percent on Friday trading.

Image Credit: Public Domain

Market News and Data brought to you by Benzinga APIs