Buy Otonomy (OTIC) on Any Weakness Following Trial Results, Piper Jaffray Says

Piper Jaffray analyst Joshua Schimmer has come out in defense of Otonomy (NASDAQ: OTIC), which is down sharply in pre-open trading after announced Phase 2b topline data for OTO-104 in Meniere's Disease, which "narrowly missed achieving statistical significance." Schimmer said while the trial did not reach statistical significance it still looked solid.

"While the trial barely missed the primary endpoint of reduction in vertigo frequency with P value of 0.067, we believe the results indicate an active drug which should have a viable path forward," the analyst said. "The company will request a meeting with the FDA and plans to initiate 2 parallel P3 trials with at least one commenced by end-2015. We believe the P2b data (along with P1b data reported last year) demonstrate the benefit of OTO-104 in reducing vertigo and thus with proper trial designs, OTIC has a strong chance to succeed in the upcoming P3 trials. As such, we reiterate our OW rating with a PT of 46. We believe any weakness in the shares represents a compelling buying opportunity."

For an analyst ratings summary and ratings history on Otonomy click here. For more ratings news on Otonomy click here.

Shares of Otonomy closed at $31.05 yesterday.

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