Ladenburg Thalmann raised its price target for Palatin Technologies (NYSE American:PTN) to $3,75 from $2.75 after the FDA approved Vyleesi as the first as-needed treatment of premenopausal women with acquired, generalized hypoactive sexual desire disorder (HSDD). The stock closed at $1.34 on June 21.
The approval marks Palatin’s first NDA approval and a $60-million regulatory milestone payment from its North American marketing partner, AMAG Pharmaceuticals, which are roughly three times Palatin’s annual operating expenditures.
Analyst Michael Higgins writes that Palatin will collect 8% to 12% tiered sales royalties and may earn more than $300-million in sales milestones. He expects for AMAG to generate net Vyleesi sales of about $100-million in 2020 and about $350-million in 2023.
“While Palatin’s royalties are relatively modest (about 10%), the sales milestones effectively double its Vyleesi revenues,” Mr. Higgins said.
In the second half of 2019, he expects Palatin’s efforts to partner Vyleesi in Europe to increase. “We look for a partner to fund a pivotal to include postmenopausal women too, with Palatin/AMAG leveraging the data to expand the market opportunity in the U.S,” he added.
