Biotech company Pharming Group NV announces the analyst report completed
by Joseph Pantginis, Ph.D. from Roth Capital Partners is published.
A discussion with management indicated a flurry of background activities ahead of the April PDUFA for Ruconest. Additionally, Pharming announced that partner MegaPharm received marketing authorization and reimbursement approval for Ruconest in Israel. All eyes remain on the April 2014 PDUFA date for Ruconest in the U.S. Reiterate Buy and raising price target to $3 from $2.
A discussion with management indicated a flurry of background activities ahead of the April PDUFA for Ruconest. Additionally, Pharming announced that partner MegaPharm received marketing authorization and reimbursement approval for Ruconest in Israel. All eyes remain on the April 2014 PDUFA date for Ruconest in the U.S. Reiterate Buy and raising price target to $3 from $2.
PHARM: Management Meeting and Approval in Israel; Target Upped to $3
A discussion with management indicated a flurry of background activities ahead of the April PDUFA for Ruconest. Additionally, Pharming announced that partner MegaPharm received marketing authorization and reimbursement approval for Ruconest in Israel. All eyes remain on the April 2014 PDUFA date for Ruconest in the U.S. Reiterate Buy and raising price target to $3 from $2.
Event
We met with management of Pharming to discuss background activities ahead of the April PDUFA for Ruconest in the U.S. Recall that U.S. partner Santarus (SNTS-Neutral) was recently acquired by Salix (SLXP-Buy) and there were no change of control issues regarding the partnership with Pharming. Additionally, Pharming's partner, privately-owned MegaPharm Ltd., received approval and full reimbursement for Ruconest in Israel. MegaPharm will buy a commercial supply of Ruconest from PHARM at a price based on percentage of net sales and anticipates launching the drug 1Q in Israel.
Impact: We believe Pharming is well positioned for 2014 wiith what we consider to be the de-risked April PDUFA for Ruconest coming up soon (positive Phase III under SPA). Overall we believe two major factors (of several) will help propel Pharming forward this year; 1) Shire acquisition of ViroPharma for $4.2 billion (Ruconest represents a pure and safer threat to Cinryze) and 2) Salix' acquisition of Santarus (Pharming's U.S. partner). Ruconest is approved ex-U.S. for the treatment of acute angioedema attacks in patients with hereditary angioedema (HAE) due to C1 esterase inhibitor deficiency. Recall that PHARM has also partnered with Shangai Institute of Pharmaceutical Industry (SIPI), a division of Sinopharm, for commercialization of Ruconest in China. We believe that the drug is poised to take over a significant share of the HAE market, given its low COGS allowing for competitive pricing, safety, convenience, and strong efficacy. Ruconest benefits from a benign safety profile, with no thromboembolic events seen to date, compared to plasma derived Cinryze and Berinert with an incidence of ~3.4% rate of thrombosis events. This may be attributable to the plasma derived Cinryze and Berinert with ~20-25% impurities in their formulations.
Action: We reiterate our Buy rating and are increasing our target to $3 from $2. The company's strategy to expand geographies through collaborations and to develop therapies for rare diseases will bear fruit over the long term, in our opinion. Given the pricing power of orphan drugs and the expanding markets in these indications due to better diagnoses, we believe that Pharming is well-positioned for commercial success.
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