Serial disappointments have made investors understandably cagey about Xenoport (NASDAQ:XNPT)
and the question of whether its "transported prodrugs" can really
achieve meaningful improvements in efficacy and/or safety. Even so, I
find it curious that the shares have been so weak over the past six
months as the company approaches key data from a study of XP23829 (or
'829) in psoriasis. I don't believe there is anything like enough
evidence to say that this is "another Receptos (NASDAQ:RCPT)", a company that has seen a pronounced run in its shares
on the back of strong data in multiple sclerosis and ulcerative
colitis, but the fact remains that this company may yet have a clinical
pipeline candidate with more than $1 billion in revenue potential in
both multiple sclerosis and psoriasis.
I continue to believe that
Xenoport is a long-shot story. The company has yet to establish that its
R&D approach can develop meaningfully better drugs, but bulls can
fairly retort that it only takes one success for the stock to work. The
multiple sclerosis and psoriasis markets are competitive markets
already, and likely to become more so, but even modest assumptions
regarding the odds of clinical success would argue that Xenoport is
undervalued ahead of what could be a significant share-moving event.
Continue reading here:
Xenoport Not Getting Much Love Ahead Of Key Data
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