HCW starts Relypsa at buy


H.C. Wainwright has initiated coverage of Relypsa (NASDAQ:RLYP) with a “buy” rating and price target of $63. The stock closed at $28.31 on Wednesday.

“We believe [Relypsa’s] Veltassa is well positioned to address the serious unmet need to treat hyperkalemia (HK) and become the standard of care,” writes analyst Ed Arce.

Veltassa is a non-metal, oral, once-daily potassium binder approved for the treatment of HK, or excess blood potassium, K+.

Mr. Arce said that although HK is a serious, life-threatening condition, available therapeutic options are poor, including a reduction or discontinuance of RAAS inhibitor therapy.

Since virtually all of the more than three million U.S. patients with HK are also hypertensive, RAASi therapy is widely used in these patients as a recommended therapy to delay kidney disease progression and decrease mortality, he added.

However, RAASi medications also cause or worsen HK, creating a Catch-22 for physicians, he pointed out. Because there are no good options for HK, which can cause arrhythmias and sudden death, physicians have little choice but to discontinue RAASi medications, despite their proven benefits.

“Against this backdrop, Relypsa aims to create a market for the chronic treatment of HK with a drug that consistently and progressively reduces K+ within hours, and safely maintains normal K+ levels for at least a year,” Mr. Arce said.

Veltassa is expected to launch in the first week of January with 120 sales reps, plus co-promotion by Sanofi’s experienced nephrology sales force.