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Enanta To Retain Momentum On The Back Of Upcoming FDA Decision

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Emerging Equities


  • Enanta to receive FDA decision on next-generation protease inhibitor Glecaprevir.
  • The company stands to gain higher royalties from Glecaprevir than from Paritaprevir.
  • Entana is also developing treatments for other liver ailments such as NASH.

Enanta Pharmaceuticals (NASDAQ:NASDAQ:ENTA)is a biotechnology firm focused on developing small molecule drugs for treating various ailments including liver diseases. The company is looking to recalibrate its HCV portfolio with the introduction of Glecaprevir. The FDA is expected to provide its decision in August, which may prove to be a solid catalyst for the stock. The company is also focusing on diversifying its portfolio by developing treatments for other liver issues such as Non-alcoholic Steatohepatitis (NASH) and Respiratory Syncytial Virus infection (RSV). Enanta is also scheduled to announce Phase 1 study data for its other pipeline drug EDP 305 later this year, resulting in another possible catalyst for the stock .

The company has its fingers in several pies with one product Paritaprevir, a protease inhibitor already in the market and another HCV product Glecaprevir on its way as the company expects the FDA to announce its decision in August. Glecaprevir is a second generation protease inhibitor and is designed to replace Paritaprevir, for which the company holds a collaboration with AbbVie. Enanta expects substantial increase in its milestone payments and royalties with the approval of Glecaprevir. The company had reported $9 million in revenue for the quarter ended March 31 and it consisted entirely of royalty payments from AbbVie for the use of Paritaprevir in its HCV treatment regimes. The company has reported its Glecaprevir payments to be more lucrative than Paritaprevir as shown by the diagram below.

Enanta’s collaboration with AbbVie allows it to piggyback on its stronger partner as the company is not required to incur prohibitive marketing expenses for competing in the market. AbbVie’s collaboration also allows it to yield the benefits of brand name association.

The company’s long term value proposition comes from the fact that the company is not only working on the HCV front, but

This article was written by

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Long-term trader with an interest in emerging Bio stocks.

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