UPDATE: Piper Jaffray Downgrades Novan (NOVN) to Neutral; Sets 'Street Low' $0.50 PT
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(Updated - January 6, 2020 8:37 AM EST)
(updated to add analyst comments)
Piper Jaffray analyst David Amsellem downgraded Novan (NASDAQ: NOVN) from Overweight to Neutral with a new 'Street Low' price target of $0.50 (from $6.00).
The analyst commented, "Novan reported top-line data from its two Phase III studies evaluating SB206 in molluscum contagiosum (MC). Both studies failed to meet the primary endpoint, which was the percentage of patients with complete clearance of all treatable lesions at week 12. We are downgrading NOVN to Neutral from Overweight, and lowering our PT to $0.50 from $6 (PT is essentially at cash from 30x 2024E EPS prior). Though we concede that NOVN has had a handful of trials that have clearly demonstrated efficacy signals (i.e., one successful pivotal study for SB204 in moderate-to-severe acne; a Phase II study for SB206 in external genital warts associated with HPV), the latest failure certainly has heightened our doubts that the company will ever be able to commercialize a product out of its topical nitric oxide platform. In that vein, we do not believe that shares should trade above its cash position (cash on hand of $15.5M as of 9/30/19)."
Shares of Novan closed at $3.11 yesterday.
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