Yesterday marked the beginning of the 3rd quarter. This is the make or break quarter for AERI. I'm betting big on the Make! NDA for rhopressa and Top Line for Roclatan which has the potential to be a $1-2B blockbuster. Expecting both to be announced in the late August to early September timeframe.
Same safety data presented end of February causes stock to spike 20%. Today, put in the form of an abstract causes stock to fall 15%. Did anyone bother to actually read the conclusions of the same exact abstract?
Damage is done. Perfect. This is going to cause a long runway to accumulate a lot of shares leading up to NDA filing and Roclatan top line in Q3.
Sounded fantastic. Even though this was a 12-month safety trial, the efficacy data was very important. Basically, on the safety side, no changes from 3 months and no new adverse events - perfect. On the efficacy side, the bear case was debunked as many who looked at the 3-month data had thought efficacy would fall into 12 months. Instead, efficacy held steady relative to 3 month at 12 months and was better than Timolol that loses efficacy over time. The home run would have been a further drop in IOP at 12 months. We didn't get it but I will take level IOP at 3 and 12 months. Overall, rhopressa is stacking up as, at a minimum, an alternative to Timolol and better yet, superior given stable efficacy, good safety profile and only a once per day application.
The real home run and a potential blockbuster is going to be Rocaltan as the first combination therapy (rhopressa and lantanoprost) in the US with a once per day application. Once a day is really important as glaucoma patients are notorious for lack of compliance - they tend to be older folks - what do you expect!! This could be a $1-2 B drug therapy in the US alone. Gloablly, who knows.
Lots of data to come out through the year and was covered on the call. What wasn't covered on the call is the potential to cut development/clinical/distribution deals in Europe and Japan. Upfront capital to AERI, milestone payments and a royalty stream on sales outside the US. Of course, this could all not come to pass if a large pharma just decides to buy the whole thing.
Herein lies our biggest upside risk - it gets taken away from us too early!!
I can easily get to $40 - 50 and you don't need to use much imagination to get to upwards of $80 with share count going to 30 MM.
Suggar, you are correct regarding negative sentiment toward pharma pricing in an election year. However, eventually the market will also sort out the companies that do indeed have pricing risk from those who do not. In the case of AERI, management is forecasting that the once a day therapy Rhopressa/Roclatan will be priced at $125 per month. This is well below the threshold that will come under attack. Furthermore, glaucoma is a lifelong chronic disease requiring drug therapy.
The human eye did not keep up with evolution. The eye was not designed for a human that lives 80+ years but one who had a lifespan of only 30 years or so.