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Supernus target upped to $45 by Jefferies

May 31, 2017

Steinberg is raising FY18-20 Trokendi (TXR) revenue and EPS 14-17% and 14-22% respectively – based on the significant reacceleration of Rxs following the April prophylaxis migraine launch.

“There has clearly been an inflection in Rxs since SUPN began to formally detail TXR for prophylaxis migraine 6 weeks ago, immediately following the approval of this label expansion,” the analyst commented. “Specifically, TRxs are now tracking 21% higher than the week prior to the migraine launch and NRxs (a leading indicator) are at a run rate 38% higher – even before a potential sales force expansion to help further penetrate this large market.”

The analyst also said that given the very large opportunity their updated forecast could prove conservative. The analyst explains: “There are ~20M Rxs written annually for migraine prophylaxis and of these, nearly half (~9.5M Rxs) are immediate release (IR) forms of topiramate – the base molecule of TXR. Despite wide scale use, there are several issues with IR topiramate. First, patients do not get full 24-hour coverage and therefore migraines may not always be prevented. Secondly, there are often side effects (i.e., dizziness, fatigue, and somnolence) with even the low 50mg IR dose. In fact, SUPN’s market research indicates that ~60% of patients are unsatisfied with IR topiramate treatment. Conversely, TXR demonstrates a smoother pK profile vs IR topiramate and can potentially be used at higher, more optimal doses (100, 200mg) without significant side effects.”

In addition, the firm remains optimistic about about the company’s maturing late-stage pipeline (SPN810, SPN812) and see the co fitting their M&A thesis.

The firm raised FY 2018 EPS from $1.34 to $1.52.


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