- Oops!Something went wrong.Please try again later.
The current macro environment has seen biotechs’ valuations soar on the back of providing possible treatments or vaccines for COVID-19. However, the uptick hasn’t been industry wide. Take micro-cap Palatin (PTN) for example, which has experienced no such rally. In fact, Palatin shares have declined by 42% year-to-date.
However, H.C. Wainwright analyst Joseph Pantginis suggests there is plenty of upside in the cards for the small biotech stock. Pantginis kept a Buy rating on PTN, along with a $2 price target. Expect massive upside of 341% over the next year, should the 5-star analyst’s thesis play out. (To watch Pantginis’ track record, click here)
Yesterday, Palatin announced F3Q20 results, reporting EPS of -$0.02, in line with the Street’s expectations. The company rounded out the quarter with $88.9 million in cash, and importantly, has no debt. Management told investors there’s enough cash in the coffers to last through March 31, 2022.
But more pressing for Pantginis is the issue concerning Palatin’s lead product, Vyleesi (Bremelanotide), a treatment for hypoactive sexual desire disorder (HSDD).
Vyleesi received the FDA’s nod of approval in June 2019, and its North American rights are currently exclusively licensed to AMAG Pharmaceuticals (with Palatin receiving royalties). However, following an internal shake up, AMAG announced it would be divesting Vyleesi and is currently looking for a new US home for the drug. AMAG hopes to finalize Vyleesi’s divestiture over the coming months, and has stated that several parties have shown an interest in taking on the drug.
With the initial market for bremelanotide in the US numbering roughly 5.8 million women, Pantginis believes finding a suitable home will play a major role in whether Vyleesi can fulfill its potential.
Pantginis said, “Palatin's pipeline continues to further mature; however, we still await the all important answer as to where Vyleesi is likely to end up… As mentioned by management, key to the successful commercialization of Vyleesi is to find the right partner, possibly a company already in the space, with the appropriate education programs and sales forces in place. As discussions continue for additional partnerships for Vyleesi, including in E.U., we believe the recent FDA approval is a major de-risking event and should accelerate the signing of a term sheet.”
Overall, Palatin has slipped under most analysts’ radar; the stock’s Moderate Buy consensus is based on just two recent ratings. With shares trading at $0.45, the $2.50 average price target suggests room for over 450% upside. (See Palatin stock analysis at TipRanks)