A ROTH Capital Partners report provided the takeaways from a recent meeting with the management team for this company, which is targeting an orphan indication.
In a Sept. 4 research note, analyst Scott Henry reported ROTH Capital Partners expects Catalyst Pharmaceuticals Inc.'s (CPRX:NASDAQ) Firdapse has a 90% chance of getting regulatory approval as a treatment for Lambert-Eaton myasthenic syndrome (LEMS) at its upcoming PDUFA date, Nov. 28, 2018.
ROTH's confidence is largely based on two factors, noted Henry. One is the strong clinical results Catalyst has demonstrated for Firdapse in LEMS to date. The other, which reduces regulatory risk, is the fact the FDA provided input on Catalyst's Phase 3 trial, including the design and endpoints along with the method for analyzing the resulting data.
Also in the report, Henry relayed that ROTH revised some of its estimates pertaining to the likely impending launch of Firdapse (amifampridine phosphate), Catalyst's lead product candidate, for LEMS.
The investment banking firm boosted its estimate of annual revenue from Firdapse to $185,000 per patient from $100,000 per patient. "We believe that this more accurately reflects the current environment for orphan drug products," Henry noted.
ROTH also altered the launch pattern in its model to quarterly versus annually, "to better reflect the duration of patient treatment within a launch year," explained Henry. For 2019, the firm forecasts quarterly uptake of Firdapse to be 1%, 3%, 5% and 7%, respectively, with a net total of 293 patients taking the drug at year-end.
The analyst pointed out that the market penetration of Firdapse could benefit from Catalyst's expanded access program, from which it has an undisclosed number of potential candidates for the pharmaceutical. "The company will have case managers hired prior to launch that should be able to facilitate reimbursement for this group, and this could lead to a robust, relatively steep, Firdapse launch curve," Henry added.
"We continue to view the risk/reward as favorable for investment in Catalyst's shares for speculative investors," the analyst concluded.
ROTH has a Buy rating and a $6 per share target price on the company, whose stock is currently trading at around $3.40 per share.
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Disclosures from ROTH Capital Partners, Catalyst Pharmaceuticals Inc., Company Note, September 4, 2018
Regulation Analyst Certification ("Reg AC"): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.
Within the last twelve months, ROTH has received compensation for investment banking services from Catalyst Pharmaceuticals, Inc.
ROTH makes a market in shares of Catalyst Pharmaceuticals, Inc. and as such, buys and sells from customers on a principal basis.
Shares of Catalyst Pharmaceuticals, Inc. may be subject to the Securities and Exchange Commission's Penny Stock Rules, which may set forth sales practice requirements for certain low-priced securities.
Within the last twelve months, ROTH has managed or co-managed a public offering for Catalyst Pharmaceuticals, Inc.
ROTH Capital Partners, LLC expects to receive or intends to seek compensation for investment banking or other business relationships with the covered companies mentioned in this report in the next three months.