Osmotica target cut at SVB Leerink after FDA snub; retains outperform

 

• Osmotica Pharmaceuticals (NASDAQ:OSMT) has lost 20.8% today so far, as SVB Leerink cut its price target after the company announced the receipt of the Complete Response Letter from the FDA for its arbaclofen extended-release tablets to treat spasticity resulting from multiple sclerosis.
• The new price target of $7 down from the previous $10 reflects the drug candidate's exit from its model, implying a 32.3% upside from yesterday’s close. 
• Noting that the failure adds “more uncertainty to a product with a rocky regulatory history and questionable commercial outlook even if approved,” the analyst Ami Fadia, however, keeps the outperform rating for the stock intact, citing the ‘underappreciated potential’ for Upneeq.
• Back in July, Upneeq became the first therapy to receive FDA approval for adults with acquired blepharoptosis.
• https://seekingalpha.com/news/3647918-osmotica-price-target-cut-svb-leerink-after-fda-snub-retains-outperform-rating