Needham initiated coverage on Praxis Precision Medicines Inc (NASDAQ:PRAX), a clinical-stage biopharmaceutical company, engaged in the development of therapies for central nervous system disorders.

The company’s lead product ulixacaltamide for essential tremor (ET) is undergoing Essential3 Phase 3 program, with topline results expected in the second half of 2024 to support a planned New Drug Application (NDA) submission in 2025.

• The analyst writes that sales of Ulixa for essential tremor (ET), if successful in Phase 3, could peak at over $1 billion in 2030 (60% probability of success).
• Needham writes, “value of ulixacaltamide in essential tremor alone is underappreciated at current levels.”

The analyst initiates with a Buy rating and a price target of $145.

The company’s second program is PRAX-628 for Focal Onset Seizures.

• Praxis plans to initiate two efficacy studies in focal onset seizures. The first study is expected to begin in the second half of 2024, with topline results expected in 2025, and the second study is expected to initiate in the first half of 2025, with topline results expected in the first half of 2026.

Praxis anticipates topline results from the Phase 2 EMBOLD study of PRAX-562 for SCN2A and SCN8A developmental and epileptic encephalopathies (DEEs) in the third quarter of 2024.

Praxis is completing multiple global regulatory interactions in the first half of 2024 in anticipation of starting the pivotal phase of the program later in 2024 for Elsunersen (PRAX-222) for SCN2A Gain-of-Function DEEs.

PRAX-628 in focal epilepsy and elsunersen in SCN2A GoF could drive more than $1.5 billion in peak sales, with an upside from label expansion.

Praxis’ cash runway into 2027 and an early pipeline across the Cerebrum and Solidus platforms can potentially generate significant long-term value.

Needham adds that positive data from Ulixa Phase 3 and POC for PRAX-562 in the third quarter should continue to drive momentum in Praxis stock.

Price Action: PRAX shares are down 3.44% at $40.27 at the last check on Monday.

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