2 Reasons Why Cantor Fitzgerald Is Bullish on Strongbridge Biopharma

Strongbridge Biopharma plc SBBP, a commercial-stage biopharma company focusing on therapies for rare disease, is an attractive investment option, according to one analyst.

The Rating

Cantor Fitzgerald analyst Elemer Piros initiated coverage of Strongbridge Biopharma with an Overweight rating and $14 price target.

The Thesis

Strongbridge Biopharma is attractive on two fronts: its ongoing commercialization of the ultra-orphan drug Keveyis in primary periodic paralysis and late-stage development of Recorlev in Cushing's clinical program, Piros said in a Tuesday note. (See Piros' track record here.) 

Success on either front could prove to be a major inflection point for the shares, especially as the shares remain significantly undervalued, Piros said. Over the next 12 months, the company is set up for several key catalysts, including its quarterly Keveyis sales reports and two Phase 3 readouts with Recorlev in 2018, the analyst said. 

The company has the right in team in placing, as it boasts executives with previous experiences in several blue-chip companies and an impressive sales force with experience in orphan organizations, according to Cantor Fitzgerald. The company is well-equipped to successfully relaunch Keveyis following a failed attempt by Taro Pharmaceutical Industries Ltd. TARO, Piros said. 

Recorlev has the potential to become a mainstay treatment of Cushing's syndrome, according to Cantor Fitzgerald. The market for Cushing's has already been validated by rival Corcept Therapeutics Incorporated CORT, whose commercial drug Korlym is expected to achieve annual revenues of $157 million to $162 million, Piros said. 

The Price Action

Strongbridge Biopharma stock is up over 166 percent year-to-date.

Related Links:

Attention Biotech Investors: Mark Your Calendar For These December PDUFA Dates

FDA Decisions In November: The Month In Review