Where High-Flying Cara Therapeutics Could be in 5 Years

Published: Oct 06, 2017

Where High-Flying Cara Therapeutics Could be in 5 Years October 6, 2017
By Alex Keown, BioSpace.com Breaking News Staff

SHELTON, Conn. – Shares of Cara Therapeutics have dipped significantly since prices spiked in June following the company’s snagging of Breakthrough Therapy Designation from the U.S. Food and Drug Administration for its chronic kidney disease treatment CR845.

In June, when the company received the designation, share prices soared and hit $26.95. Prices though have fallen by nearly half to this morning’s price of $13.75 as of 10:54 a.m. Cara’s treatment is designed to alleviate pain and pruritus by selectively targeting peripheral kappa opioid receptors. The company is also expecting top-line data from a Phase IIb trial of Oral CR845 in chronic pain associated with osteoarthritis are expected in the second quarter of 2017. The FDA’s designation isn’t the only good news the company has seen in the past few days. On June 21, the company saw another spike in share prices after it released positive interim data for a Phase III trial of CR845 as a treatment for post-operative pain.

As the company looks to the future and a possible New Drug Application, so too are investors. One analyst has gotten out his crystal ball to get an inkling of what the next five years might hold for Cara. Writing in The Motley Fool, analyst Keith Speights looks at a positive future and a negative future.

If things go well for Cara, Speights predicts the company could be a “tremendous success story” by 2022. The first hurdle for that goal will be readout for CR845. If the Phase III results are positive, Cara could have the drug approved by 2019. If CR845 is approved for multiple indications, Speights pegs the potential revenue stream at more than $1 billion. If that happens, Speights said investors will be extremely happy and predicts shares of Cara common stock “would be worth perhaps 10 times the current valuation.”

But that’s a positive view. Speights also looks at the potentials for negative results. If CR845 doesn’t achieve positive results in late stage trials, Speights said that would be bad news for the company. He said if the IV version of the drug fails, it’s likely that the oral version would fail as well. If the trials are a flop, that would leave Cara with no clinical programs. Cara does have one potential therapy in preclinical testing, a cannabinoid drug, CR-701.

But, Speights said he prefers to look at the positive. He said the late-stage trials for CR845 are “reasonably good” with no significant safety concerns.

“We will probably know whether the glass is half full or half empty for Cara in a few months,” Speights said.

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