Generic EpiPen Pricing Parity and Less than 1% Share Supports $10 Adamis (ADMP) Target Price - Maxim Group

August 29, 2016 1:04 PM EDT
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Price: $2.80 -1.75%

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After surging 25% on Friday as investors focused on the company's PFS an alternative to EpiPen, Adamis Pharmaceuticals (NASDAQ: ADMP) is down 15% Monday as Mylan (NYSE: MYL) announced the launch of a generic version for a list price of $300 per two-pack carton, a 50% saving.

Commenting on Adamis amid the news, Maxim Group analyst Jason Kolbert said price parity with existing generics at time of launch and modest share (less than 1%) of the market the first few years support their $10 price target. Although they expect Adamis' market share could actually be much greater.

Kolbert explains that what is causing EpiPen to be expensive is not the epinephrine, which treats life-threatening anaphylaxis, but the auto injector, a delivery mechanism that can precisely inject a single 0.3-mL dose of 1:1000 epinephrine into muscle. He notes it has been reported that some consumers purchase epinephrine and self-inject with a common syringe to save on cost.

"We believe this could create an opportunity for Adamis to acquire market share with a price competitive and superior product," he said. "Adamis has developed an epinephrine Pre-filled Syringe (PFS) comparable to EpiPen. It is an epinephrine injection USP 1:1000, 0.3mg pre-filled single dose syringe. We have evaluated the device and find it in many ways to be preferable to EpiPen, in size, shape and overall function; price may be a strategic advantage too."

In June, Adamis' PFS a Complete Response Letter (CRL) from the FDA regarding its New Drug Application (NDA) for the PFS product. Adamis has outlined the steps needed to resubmit the NDA. They believe there is nothing extraordinary in the steps and see PFS as close to approval now, with data submission by year-end or early 1Q17.

The firm reiterated a Buy rating and price target of $10.

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

Shares of Adamis Pharmaceuticals closed at $3.47 yesterday.



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