September 24, 2014
By Riley McDermid, BioSpace.com Breaking News Sr. Editor
ZS Pharma reporting of positive top-line results from a second Phase III trial of its ZS-9 drug candidate in patients with hyperkalemia is another solid gain from the company post initial public offering, analysts from Credit Suisse said today.
Credit Suisse biotech analysts Vamil Divan, Ari Jahja and Ronak Shah wrote in a note that the news was solid evidence that ZS Pharma has strong fundamentals in its pipeline.
“We view ZSPH as a high-class specialty pharma company that is well positioned to deliver strong long-term growth through its proprietary ‘ion-trap’ technology,” they wrote. “ZSPH is also led by an experienced management team and post IPO is well capitalized to execute on its wholly-owned asset.”
ZS Pharma’s stock was lower in Wednesday afternoon trading after gaining nearly 10 percent on the news the day before.
The company reported that preliminary trial results showed that patients receiving all three dosing levels of the once-daily medication did not have a reoccurrence of hyperkalemia after 28 days, achieving the primary endpoint of the late-stage trial.
“It remains on track to file ZS-9 in the first half of 2015, likely only 3-6 months behind its key competitor (patiromer) but with what appears to be a better clinical profile,” wrote Divan,Jahia and Shah. “As a reminder, we currently forecast ZS-9 to launch in first half of 2016, with U.S. peak sales of around $935 million in 2030.”
Credit Suisse maintained an outperform rating on the stock. “Our $54 target price is based on discounted cash flow valuation with an 11.5 percent weighted average cost of capital and forecast discounted cash flows through 2033, with no terminal value thereafter,” said the analysts.
