Ladenburg starts Aviragen Therapeutics at buy

Ladenburg Thalmann has launched coverage of Aviragen Therapeutics (NASDAQ:AVIR) with a “buy” rating and $2.50 price target. The stock closed at $1.60 on Tuesday.

“We view Aviragen as an emerging small molecule antiviral story with important proof-of-concept data from two Phase 2 programs – respiratory syncytial virus (RSV) and rhinovirus (HRV) – expected in the next six months,” writes analyst Kevin DeGeeter.

If both of these studies are successful, he expects Aviragen to seek a commercial partner for one or both of the programs prior to Phase 3 development.

“Our upbeat outlook for shares of Aviragen is based, at least in part, on the track record of current management, which previously worked at Inhibitex, in delivering shareholder value through business development,” he said, adding that the company recently strengthened its balance sheet through a $20-million royalty financing vehicle.

Based on a cash balance of $69-million on June 30, Mr. DeGeeter figures the company has adequate cash balances to fund operations into fiscal 2018. “As such, we believe Aviragen is now positioned to complete two important milestones before requiring additional financial resources,” he added.

He said near-term milestones include Phase 2b data for vapendavir in asthmatic adults with HRV infections in the fourth quarter this year and top-line data from the Phase 2a RSV challenge study of BTA585 also in the final quarter.


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