More Than 100% Upside Seen In Imprimis After Q4 Results

Imprimis Pharmaceuticals Inc IMMY, a nano-cap pharmaceutical company that owns, markets and dispenses a portfolio of compounded therapeutic in several areas, reported improved quarterly results on a year-over-year basis.

The company reported a loss of $0.44 per share in the fourth quarter on revenue of $5.7 million. This compares to the same quarter a year ago, when the company lost $0.53 per share on revenue of $3.5 million.

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100% Upside

Raghuram Selvaraju of Rodman & Renshaw reiterated a Buy rating on the stock with an unchanged $5 price target, which implies an upside of around 100 percent based on Tuesday's closing price of $2.42.

Selvaraju noted Imprimis' fourth quarter revenue was in-line with his expectations, but earnings fell short due to the company's $2 million cost from the early extinguishment of debt.

Of particular note, Imprimus began dispensing core sterile ophthalmic formulations from its New Jersey FDA-registered 503B outsourcing facility. Moreover, the company said  doctors have been ordering its products in larger quantities since shipment began under 503B. As such, the company's revenue could continue growing and the analyst is projecting 2017's revenue to be $30.9 million.

Production Expansions

Imprimus' management also said the customer base for its Dropless and LessDrops products now totals 1,500 ophthalmologists, with a growing library of published clinical data. The analyst noted these two products are also the primary products being dispensed from the company's 503B outsourcing facility compliant with good manufacturing practices, which doesn't require doctors' prescriptions for individual patients.

The company also expects to launch its glaucoma strategy in the first half of 2017 which may consist of a series of preservative-free combination drops.

Bottom line, Selvaraju suggested that while the company may need to raise additional capital in 2017 it will be a profitable enterprise in 2018.

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