Buy Palatin Technologies (PTN) Ahead of Phase 3 BMT Data - Roth Capital
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Roth Capital affirms Palatin Technologies (NYSE: PTN) with a Buy rating and $4 price target, recommending that investors accumulate shares into Phase 3 BMT data.
Analyst Joseph Pantginis,
Needless to say, our thesis has remained unchanged on Palatin for quite some time and the Phase III data release shortly represents the most pivotal event in the company's history, in our belief. With all of the noise (or lack thereof) from Valeant (VRX-NC) and Addyi, we believe that BMT is poised to supplant Addyi as the standard of care for FSD and be the "true" first to market drug for the indication. As mentioned above, we believe the Phase IIb data support a positive Phase III outcome and recall that BMT also has other potential advantages over Addyi, which should help it drive market penetration.
In short, Addyi is an intractable drug with a black box warning requiring signed waivers promising no alcohol use (risk of severe hypotension and syncope). It is a chronic use drug with four to six weeks required before initial onset of efficacy and is only available through a restrictive REMS program. BMT is an "on-demand" drug with onset of activity in ~30 minutes and an effect of eight to 10 hours and has no alcohol interaction.
Management continues to indicate enhanced interest on the partnering front for BMT, although there has been some discussion surrounding the market size/demand due to the missteps and lackluster launch of Addyi. These questions should easily be addressed, in our belief. Our thesis on PTN remains strong and any risk of Addyi issue readthrough to BMT and Palatin is unwarranted, in our belief.
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