Sol Gel Technologies Ltd. (SLGL) PT Lowered to $6 at H.C. Wainwright

H.C. Wainwright analyst Raghuram Selvaraju lowered the price target on Sol Gel Technologies Ltd. (NASDAQ: SLGL) to $6.00 (from $9.00) while maintaining a Buy rating.

The analyst commented: "In a press release late last week, Sol-Gel announced that it has signed an asset purchase agreement with China-based Shenzhen Beimei Pharmaceutical Co. Ltd. for the commercialization of Twyneo in treatment of acne vulgaris across mainland China, Hong Kong, Macau, Taiwan and Israel. Under the terms of the agreement, Beimei purchases and licenses rights to exclusively commercialize Twyneo in these territories. In return, Sol-Gel will receive, subject to applicable government approvals, upfront and milestone payments of $10M and up to $5M as royalty payments on net sales. We have assumed that the upfront payment received totaled roughly $1M and that Sol-Gel would begin receiving additional milestone payments next year. Given the trajectory of Sol-Gel's drugs currently being commercialized in the U.S. by its partner Galderma (GALD.SW; not rated), we are reducing our 12-month price target to $6 from $9 to reflect a slower revenue ramp and lower peak sales. We reiterate our Buy rating. Investors should note that Sol-Gel management expectations are for additional regional partnerships to be announced in the coming months on both Twyneo and Epsolay."

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