SVB Leerink launched coverage of Osmotica Pharmaceuticals (NASDAQ:OSMT) with an “outperform rating” and $10 price target. The stock closed at $5.47 on March 5.
Analyst Ami Fadia writes that her rating is based on the potential opportunity that the lead asset, RVL-1201, could capture in blepharoptosis, or droopy eyelid. “We estimate RVL-1201 could drive peak revenue potential of about $430-million in 2030, given a total addressable market of $900-million in the U.S. and more than $3-billion globally.”
She believes RVL-1201 could become the first FDA approved medical treatment for droopy eyelid, offering functional and cosmetic benefit to mild-to-moderate patients and supplementing surgery for severe patients. “We estimate a peak penetration of 25% in mild-to-moderate patients and 5% in severe patients,” she added.
For the base business of existing specialty and generic products, “we expect it to decline low double digit over the next five years, and this is well understood by the Street,” Ms. Fadia said. We are cautious on the other pipeline product, arbaclofen ER, given the mixed clinical data and KOL feedback.”
