UPDATE: Cowen Sees Opportunity in Alimera Sciences (ALIM) and Upgrades Stock to 'Outperform'
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(Updated - September 16, 2016 10:16 AM EDT)
Cowen upgraded Alimera Sciences (NASDAQ: ALIM) from Market Perform to Outperform with a price target of $3.00. Analyst Boris Peaker said recent financing lifts an overhang and "bridges Alimera to cash flow positive."
"Alimera’s Iluvien, a sustained-release, intravitreal insert delivering fluocinolone acetonide (steroid), is approved for DME in US and 17 European countries. Alimera is marketing the drug in the US and Europe. After a slow start, sales continued to grow steadily and we believe that within the next year the company will become cash flow break even. Additionally, given Iluvien's complex formulation, we believe that it would be very difficult to make a generic equivalent drug. As such, we believe that as Iluvien's sales continue to grow, it will be of interest to spec pharma companies that can leverage their existing salesforce in ophthalmology" said Peaker.
The analyst added, "Alimera's key overhang was limited cash balance and restrictive debt covenants. With the $26.5M financing completed a month ago, we believe the company is capitalized to comfortably reach cash-flow breakeven next year and not at risk of tripping its debt covenants. While the stock popped to $2/share right after the recent financing, it has come back down to $1.50/share, which we view as a very attractive entry point."
Shares of Alimera Sciences closed at $1.52 yesterday.
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