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The Cockrell Group, Inc. is a strategic capital markets development firm focused on small-to-midcap companies. It aligns a company's strategic goals to an institution's investment thesis and fundamentals to create a sound, long-term investment objective. The company also advises companies in... More
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  • Healthcare Update Week Of Nov 25: Piper Resumes On Several Biotechs

    Healthcare Update

    Nov 25 2013 - Nov 29 2013


    Major Pharma

    Anthony Petrone at Jefferies initiated coverage of Mallinckrodt (MNK) with a Buy rating and $60 price target. He noted, "Mallinckrodt is uniquely positioned in a consolidating Specialty Pharma industry having three attractive attributes: 1) Potential long duration assets in Xartemis XR and MNK-155, 2) Room for margin expansion post spin; and 3) Tax leverage from its Irish domicile. We see the combination as supporting accelerating earnings over the next three years with potential optionality from M&A and licensing. We rate shares Buy with a $60 PT."

    Piper Jaffray analyst David Amsellem upgraded Forest Laboratories (FRX) to "neutral" from "underweight" and increased his price target to $49 from $33, citing the previous bearish thesis is no longer tenable given the backdrop of a dynamic M&A landscape in specialty pharma (with FRX possibly using its balance sheet more aggressively) coupled with the potential for meaningful expense savings.


    Specialty Pharma & Generics

    Teva Pharmaceutical Industries (TEVA) announced that the FDA has granted orphan drug exclusivity for TREANDA through October 2015 for indolent B-cell non-Hodgkin lymphoma (OTC:INHL) that has progressed during or within six months of treatment with rituximab or a rituximab-containing regimen. Orphan status is granted to therapies intended to treat diseases or conditions that affect fewer than 200,000 patients in the United States. With the previously granted six months of pediatric exclusivity for TREANDA, regulatory exclusivity for this indication is now extended through April 2016.


    Biotech

    Barclays analyst C. Anthony Butler increased his price target ofGilead (GILD) to $90 from $74 to reflect an updated view of a faster-than-anticipated launch of the HCV product sofosbuvir; Jefferies analyst Thomas Wei increased his price target to $80 from $40, citing a major overhaul of HCV and GILD model and an introduction of brand new estimates for GILD.

    Piper Jaffray analyst Joshua Schimmer initiated, resumed, or assumed coverage of the following companies, citing the outlook for the biotech sector in 2014 remains strong, although the tape may be somewhat choppy as the average large-cap biotech growth stock multiple is now above that of growth stocks in other sectors: initiated coverage of Chimerix (CMRX) with an "overweight" rating and $33 price target; GW Pharma (GWPH) with an "overweight" rating and $73 price target; Insmed (INSM) with an "overweight" rating and $34 price target; Nektar Therapeutics (NKTR) with an "overweight" rating and $20 price target; Repros with an "overweight" rating and $26 price target. The analyst resumed/assumed coverage of the following: Alexion (ALXN) with an "overweight" rating and $172 price target; Amgen (AMGN) with an "overweight" rating and $143 price target; Biogen Idec (BIIB) with an "overweight" rating and $331 price target; BioMarin Pharmaceutical (BMRN) with an "overweight" rating and $87 price target; Celgene (CELG) with a "neutral" rating and $170 price target; Gilead with an "overweight" rating and $91 price target; Incyte (INCY) with an "overweight" rating and $56 price target; Isis Pharmaceuticals (ISIS) with a "neutral" rating and $38 price target; Mannkind (MNKD) with a "neutral" rating and $5 price target; Pharmacyclics (PCYC) with an "overweight" rating and $160 price target; Vanda (VNDA) with an "overweight" rating and $21 price target.


    Life Sciences

    Isaac Ro at Goldman Sachs upgraded shares of Danaher (DHR) to Buy based on 2014 growth via new product cycles in LS&D and incremental share gains. In the same note, Waters (WAT) was downgraded to Neutral based on continued top line and organic growth disappointment coupled with potential share loss in pharma end markets and the effects of a prolonged management transition.


    Clinical Labs

    Bio-Reference Laboratories (BRLI) provided a preview of revenues and earnings per share expected for its FY13 and Q4FY13. Despite continued strong volume growth, the Company believes there is an ongoing recalibration of reimbursement for the industry, which has resulted in substantial downward pressure from many payers regarding reimbursement in FY13. In addition, increased infrastructure expenses related to upgrading acquisitions in Florida and California and the launch of the company's inherited cancer program that occurred too late in the period to meaningfully contribute to revenue in Q4FY13 also contributed to the results and for the quarter as well as guidance for the upcoming Fiscal Year. Based on the company's recent experience, the company expects that its guidance for 2014 will call for an increase in net revenues of 10%, an increase in patient volume of 10% and an increase in net income of 10%. The company notes, however, that this guidance may be subject to adjustment in the event that CMS (Medicare)makes any significant changes to the Physician Fee schedules for 2014.


    Medical Products/Technology

    Shagun Singh Chadha at CRT capital initiated coverage of Edwards Lifesciences (EW) with a Fair Value, Spectranetics (SPNC) andHeartware (HTWR) with a Buy, and Intuitive Surgical (ISRG) with a Sell.


    Eye Care

    No sector news.


    Healthcare IT

    Donald Hooker at KeyBanc Capital Markets upgraded MedAssets, Inc. (MDAS) to "BUY" with a $25 price target.The analyst said, "Our target valuation assumes a ~10x multiple of our 2014 EBITDA estimate ($239 million), which we think is very reasonable for a company with ~5% revenue growth, ~12% free cash flow growth (7.7% yield) and sustainable secular tailwinds related to health care reform.


    Healthcare Services

    Eric Coldwell at Baird increased his price target on Charles River (CRL) to $57 from $53 and decreased his price target on PAREXEL (PRXL) to $47 from $52. He said, "The sector posted 27% EPS growth (and 7% EPS upside vs. Street) as strong OM% expansion more than offset a modest revenue shortfall. Backlog grew to another record. We believe that fundamentals remain relatively stable and execution generally strong, though PRXL's big bookings miss and recent Pharma restructuring noise create headwinds to sentiment. Our current focus is on the largest CROs and a near-term sentiment trade in early stage.


    Managed Care

    Cowen analyst Christine Arnold decreased her price target ofUnitedhealth Group (UNH) to $85 from $87.


    Facilities

    On Friday last week after the close, Community Health Systems (CYH) and Health Management Associates (HMA) announced that the Registration Statement on Form S-4 relating to the companies' proposed merger has been declared effective by the Securities and Exchange Commission. The Form S-4 contains HMA`s definitive proxy statement relating to soliciting the required approval of the transaction by HMA stockholders. HMA is expected to commence the mailing of the definitive proxy statement to its stockholders on or about November 25, 2013. CHS and HMA encourage HMA stockholders to review the proxy statement and to vote FOR adoption of the merger agreement at the HMA special stockholders` meeting to be held in Naples, Florida, at 8:00 a.m., local time, on January 8, 2014.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Business relationship disclosure: COCKRELL GROUP does and seeks to do business with companies covered in COCKRELL GROUP Research. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of COCKRELL GROUP Research. Investors should consider COCKRELL GROUP Research as only a single factor in making their investment decision. The following analysts hereby certify that their views about the companies and their securities discussed in this report are accurately expressed and that they have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this report. Unless otherwise stated, the individuals listed on the cover page of this report are research analysts. Data provided by: Thomson Reuters

    Dec 02 12:19 PM | Link | Comment!
  • TherapeuticsMD Applauds Congressional Leadership On Passage Of Drug Quality And Security Act

    BOCA RATON, Fla.--(BUSINESS WIRE)--TherapeuticsMD, Inc. (NYSE MKT: TXMD), a women's healthcare company, commented today on yesterday's passage of H.R. 3204, the Drug Quality and Security Act.

    Robert Finizio, Chief Executive Officer and Co-founder of TherapeuticsMD, said, "The Drug Quality and Security Act is intended to improve the safety of drugs manufactured by compounding pharmacies in the United States and is a vital step for protecting public health. We applaud the many legislators in both houses of Congress who came together in a strong bipartisan effort to pass this critical legislation.

    "Compounding pharmacies play an important role in our healthcare system, complementing the broad range of products available from pharmaceutical companies by making it possible for consumers to access drugs in certain formulations they would otherwise be without. We are proponents of tighter FDA oversight to ensure that safety, efficacy and quality standards of pharmacy-compounded products safeguard public health and restore trust in the products produced and sold by these pharmacies."

    This legislation received strong bipartisan support in both the House of Representatives and the Senate. The complete text of the Drug Quality and Security Act can be found online at http://docs.house.gov/billsthisweek/20130923/BILLS-113hr__-trackandtrace-SUS.pdf.

    About TherapeuticsMD, Inc.

    TherapeuticsMD, Inc. is a women's healthcare company focused on developing and commercializing products targeted exclusively for women. We are developing advanced hormone therapy pharmaceutical products based on novel technologies that enable delivery of bioidentical hormones through a variety of dosage forms and administration routes. We also manufacture and distribute branded and generic prescription prenatal vitamins, as well as over-the-counter vitamins and cosmetics, under our vitaMedMD® and BocaGreenMD® brands. More information is available at the following websites: www.therapeuticsmd.com,www.ReplenishTrial.com, www.vitamedmd.com, www.vitamedmdrx.com, and www.bocagreenmd.com.

    Except for the historical information contained herein, the matters set forth in this press release are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including but not limited to: the likelihood that the Drug Quality and Security Act will become law; the potential impact of the Drug Quality and Security Act, if made law, on pharmacy compounding of bioidentical hormone replacement therapy (HT) products; the timely and successful development by TherapeuticsMD of new HT products; the impact of competitive products and pricing; the ability to obtain and enforce patents and other intellectual property rights; the risks and uncertainties associated with economic and market conditions; risks and uncertainties associated with the Company's business and finances in general; and other risks detailed in the Company's filings with the U.S. Securities and Exchange Commission including its annual report on Form 10-K filed on March 12, 2013, reports on Form 10-Q and Form 8-K, and other such filings. These forward-looking statements are based on current information that may change. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement, and the Company undertakes no obligation to revise or update any forward- looking statement to reflect events or circumstances after the issuance of this press release.

    Nov 19 1:37 PM | Link | Comment!
  • Garnering Investor Attention: JMP Inititates With BUY And $8 PT

    David Turklay of JMP Securities initiated coverage on AxoGen (AXGN) yesterday with a "BUY" rating and a price target of $8.

    AxoGen Inc. is an growing regenerative medicine company focused on the commercialization of proprietary products and technologies for peripheral nerve reconstruction and regeneration. The company has had more than 7,000 surgical implants of its products performed in hospitals and surgery centers across the United States, including military hospitals that serve U.S. servicemen and women.

    Turklay believes that the Company is "Hitting an inflection point" and values the company at $8 per share, which is based on an EV/Sales multiple of 5x on estimated 2014 revenues of $25 million; representing an 81% increase over his 2013 revenue estimate of $13.8 million.

    His valuation is consistent with his analyst peers and inline with the take-out multiples of regenerative medicine companies that have been purchased by larger medical device companies, have been picked up within the ~5x to ~6x range.

    Among the noteable purchases in this space was Royal DSM's (OTCQX:RDSMY) purchase of Kensey Nash was purchased for ~5x sales, Shire's (SHPG) acquisition of Advance Biohealing at ~5.1x sales, Johnson & Johnson's (JNJ) purchase of Synthes for ~5.8x sales. The most expensive purchase was Kinetic Concepts acquisition of LifeCell for $1.7 billion, or ~8.5x sales.

    Regenerative medicine continues to be a hot-bed of opportunity for investors. This is because larger med-tech companies with commoditizing products are in search of cutting-edge, high growth technologies to help bolster their top-line growth rates.

    For AxoGen, peripheral nerve regenerative represents a pioneering opportunity for the company, which Turklay noted it as a "unique one-stop shop for peripheral nerve repair". AxoGen is the sole player in a peripheral nerve allograft market that is an estimated $1 billion opportunity.

    Investors are becoming more aware of Axogen and it's products and business potential. It was recently highlighted on FOX Business News' Varney & Company and was written up in the Wall Street Journal. This has not only been positive for the Company's shares, which are up approximately 88% year-to-date, but more physicians and surgeons are being educated and introduced to the company's products, which will later translate in to improving sales growth.

    Investors should keep watch on AxoGen shares.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

    Apr 19 9:28 AM | Link | Comment!
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