COSCIENS Biopharma Inc T.AEZS

Pediatric data and licensing deal

[prophetoffactz]

There are only about 4 million shares, I believe, and the stock is currently trading around the value of its cash so it will be interesting to see how this illiquid stock reacts to significant news. HC Wainwright had a C$100 million market cap target before the share count was doubled due to the merger of equals. Even with the doubling of shares that could mean a C$25 targer price or C$50 if CZO added equal value in the merger of equals.

Top-line data for the pediatric clinical trial is expected in Q3 and there could also be a licensing deal. What did AEZS's stock do the last time there was a licensing deal alone for its diagnostic test with pediatric data still in the future? From a close of $259 the previous day the stock shot up to a high of $379 the next day and closed at $300 according to Stockhouse including the stock splits. The stock climbed at high at 46.3% higher on licensing deal news alone. AEZS received an inflation-adjusted upfront payment of C$40 million for the deal. What if AEZS announced pediatric data with a licensing deal. Many global markets only care about the test for the pediatric population too - at least the pediatric population is largely only who they test for growth hormone deficiency. AEZS could sign a global deal to capture these markets now that pediatric approval is near. 

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Ambrose O'Callaghan - Wednesday, January 17, 2018

 

Aeterna Zentaris Inc. Surges After Agreement With Strongbridge

Shares of Aeterna Zentaris Inc. (TSX:AEZS) were up 23.1% in late morning trading on January 17. The company announced a licensing and assignment agreement with a subsidiary of Strongbridge Biopharma PLC (NASDAQ:SBBP). The agreement will allow both to carry out the development of Macrilen, an orally available ghrelin agonist.

Aeterna Zentaris is a specialty biopharmaceutical company. The company announced that it had received United States Food and Drug Administration (FDA) approval of Macrilen on December 20. The drug has been developed to treat adult growth hormone deficiency (AGHD), which has shown increased prevalence over recent decades. Macrilen has been shown to stimulate growth hormone levels in a number of blood samples.

The company will receive a cash payment of $24 million from Strongbridge and will be entitled to 15% royalty on net sales up to $75 million and an 18% royalty on sales above $75 million.

Aeterna Zentaris released its third quarter results on November 8, 2017. Revenues were up to $745,000 for the nine month period ending September 30 compared to $607,000 in the previous year. Research and development costs actually dipped year over year from $11.9 million in Q3 2016 to $10.2 million in the most recent quarter. Net income year to date was $3.2 million compared to $5.4 million in the prior year.

The development of Macrilen and subsequent partnership provides Aeterna Zentaris with the opportunity to rake in sales revenue over the coming years.