Cantor Slaps 'Buy' Rating On Paratek Pharmaceuticals

In a report published Tuesday, Cantor Fitzgeraled analysts initiated coverage of Paratek Pharmaceuticals Inc PRTK with a Buy rating, with a price target of $35. Paratek is a clinical-stage biopharmaceutical company developing antibiotics for the treatment of multidrug-resistant infections. The company's lead asset omadacycline is currently in phase 3 trials and is likely to receive FDA approval in 2018. In the report Cantor Fitzgeraled noted, "Omadacycline is a next-generation tetracycline that has broad potency against bacterial strains. We believe the activity against both Gram-positive and Gram-negative bacteria will drive empirical use of omadacycline in front-line treatment of the ~10.5 million annual US ABSSSI, CABP and UTI patients, generating peak revenues of $1.2B." Another advantage that Omadacycline enjoys is that it can be administered both orally and via IV which allows easy treatment of both community and hospital patients. The analysts expect the company to be able to "justify premium pricing" in view of the "health economics of reduced hospitalization as well as the convenience of allowing patients to return home." The company is also working in partnership with Actavis Plc ACT for developing sarecycline for acne and roasacea. "PRTK's platform is built on understanding the structure/activity relationship of tetracyclines in both antibiotic and non-antibiotic applications, and we believe successful development will validate the potential of tetracyclines for non-antibiotic applications as well as provide royalty revenue from Actavis," the analysts stated.