Supernus Pharmaceuticals Inc(NASDAQ: SUPN) stock crashed over 18.1% on September 19th, 2017 as Stifel downgraded the stock to Hold from Buy. Stifel Analyst, Annabel Samimy got a price target of $47. The analyst said that the benefits/value from SPN-810 interim analysis which improves Phase 3 prospects is already reflected in the stock valuation. As per DCF analysis, analyst assumed a 9% WACC and 2% terminal growth to reach the price target. The analyst expects FY 2017 EPS to be $1.02 while FY 2018 EPS is forecasted to be $1.48.
The group is developing and commercializing products for the treatment of central nervous system (CNS) diseases, and developing SPN-810 as a novel treatment for impulsive aggression (IA) in patients aged 6 to 12 years who have attention deficit hyperactivity disorder (ADHD). SPN-810 is being tested in two Phase III clinical trials at total daily doses of 18 mg and 36 mg against placebo. The two trials are being conducted using an agreed-upon novel scale to measure IA that was developed by Supernus Pharmaceuticals with the FDA under a Special Protocol Assessment (SPA). Interim analysis was planned in the first trial when one-half of the patients (146 patients) reached randomization.
After the interim analysis outcome, the lower dose of 18 mg would be eliminated. Going forward, all patients would be randomized to either the 36 mg dose arm or placebo until the predetermined total number of patients are enrolled without changing the size of the trials. The group sees that they would maximize the probability of reaching a statistically major outcome for the 36 mg dose while this implementation would start immediately. The group intends to continue the enrollment through mid-2018.
For the second quarter of 2017, the group reported a net product sales rise of 46% yoy to $73.3 million. The group reported a rapid rise in Trokendi XR prescription post-April launch in migraine prophylaxis in adults and adolescents. Operating income surged 124% yoy to $26.1 million, and even enhanced the full year 2017, with net product sales by $15 million and operating income by $7 million. The group reported that Phase III trials for SPN-812 would start second half 2017, post the recent end-of-Phase II meeting with FDA.