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karmaswimswami
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MD, PhD, FACP
  • QRx Pharma Is A Buy  2 comments
    Feb 28, 2014 10:53 AM | about stocks: QRXPY

    I am reiterating a buy rating on QRx Pharma (OTCQX:QRXPY). I feel that these shares are beaten down because of all the fervor just now about the FDA's approval last fall of Zohydro, a high-dose hydrocodone formulation with no abuse-deterrent features. There are calls for the FDA to pull this agent off the market from consumer and physician groups concerned about abuse. Opioid abuse is high in the US right now, but I am not necessarily persuaded that there is a new epidemic of prescription drug abuse as some claim. Certainly sites like opiophile.org might lead you to think otherwise....if you ever want to laugh or be shocked check out the site: the rantings of abusers about what combos work best to make one high, and about which doctors are easiest to score narcotic prescriptions from. Much of the American problem is non-prescription: it owes to the ready availability of extremely cheap heroin (as Philip Seymour Hoffman's death evinces), and in fact the US is seeing a pop in incidence, number of new cases, of HCV and HIV, even as prevalence is fairly stable.

    QRx is an Australian company whose abuse-deterrent blend of oxycodone and morphine for acute pain will be re-reviewed by an FDA advisory committee in April and has a PDUFA date in late May 2014. The main firm following it has a near term price target of A$1.79, implying US$8.05 for the ADR shares here. The company has no marketed products and has a market cap of US$132 million, and approval would be a transformative event for the company. Shares are currently at about $4. Australian analysts are famously stingy in their upside ratings, a sort of underpromise/overdeliver mentality.

    QRx has addressed all concerns about the formulation raised in a prior CRL. The science behind this blend of two drugs in the ratio set forth in MoxDuo, the agent's name, is elegant and solid.

    Disclosure: I am long QRXPY.

    Stocks: QRXPY
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  • subrkaus3
    , contributor
    Comments (81) | Send Message
     
    Dr. KSS this i one stock i am yet to buy from your recommendation. I am looking at buying DRTX and will add QRXPY. Thank you!
    28 Feb, 11:16 AM Reply Like
  • karmaswimswami
    , contributor
    Comments (125) | Send Message
     
    Author’s reply » Thanks subrkaus3. It may not be the spectacular long term shoot the moon play that BNIKF is, but as I see it, in current US market circumstances, when a company goes from having no product to having a newly-approved drug (even if it is not an exceptional or high-demand one, though MoxDuo is somewhat exceptional and may be moderate-demand), that incurs a rise in market cap to US$500-750 million. For these companies, it is like getting a license to print money. So we hold the stock til May for a quick, say, 100-200 per cent gain. There is hardly anything wrong with a quick 100-200 per cent gain, I think you'd agree.

     

    At first I thought, morphine/oxycodone combo, so what? Old wine in new skins. But there is a reason for the blend and in the ratio MoxDuo has. Better efficacy, better pain control, less respiratory suppression. This drug is the pet project of Solomon Snyder, MD, of Hopkins, our time's greatest neuroscientist. The FDA knows he is behind it and respects him deeply.
    28 Feb, 07:32 PM Reply Like
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