Buying OpportunityCurrent Price: $3.26
Recommnedation: Strong Buy
Date: March 23, 2014
Although an inactive board I wanted to mention that I believe Zogenix (ZGNX) is a strong buy at these prices. A biotech company that has recently released a single-entity hydrocodone extended release medication called Zohydro. The primary benefit is that it is the only opioid medication for chronic pain which does not include acetaminophen or aspirin which can be toxic to the liver. This medication would compete against medications such as OxyContin, Lortab, Vicodin, etc..
The medication was approved by the FDA in Oct 2013, and has just recently (last few weeks) has been available to pharamcies in the US. There has been significant efforts by politicians, and other groups to pull the product from the market citing inaccurate 'facts' and flat out lying to protect big pharma. As of Friday afternoon the CEO has began to defend the product and inaccurate claims by the media.
In terms of the share structure (140M O/S) approimately 84%+ of shares are held by institutions/mutal funds/insiders. With the negative press coming to a halt and prescriptions in the market place it is anticipated that Zohydro could capture a signifcant amount of the market.
1% share of the market = $300M to Zogenix
There is a distinct possibility that ZGNX will capture well in excess of 1% of the market. The fact Zohydro lacks acetaminophen is attractive as it can be prescribed for those with liver/kidney complications. There are 67,000+ pharmacies in the US and in the first few weeks there have been several reported pharmacies actively prescribing Zohydro for chronic pain management.
The buzz from the press has been primarily negative to date, but it has server as significant publicity for pain specialists. Now that the inaccurate statements are being corrected it should be much clearer sailing. ZGNX has been beaten down.. and should start resuming it's climb. As presecription figures are released and market share capture is established the share price will appreciate significantly.
kevgo.