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A Major October Catalyst Could Make This Eye Stock A Ten Bagger, Analyst Says

Chardan initiated coverage on Outlook Therapeutics Inc (NASDAQ: OTLK) with a Buy rati

Benzinga · 09/13/2022 14:01

Chardan INITIATED COVERAGE on Outlook Therapeutics Inc (NASDAQ:OTLK) with a Buy rating and a price target of $10 based on the company's commercial potential with its lead ophthalmic formulation of ONS-5010 (bevacizumab, Avastin), an anti-VEGF antibody in development for wet age-related macular degeneration (wet AMD). 

The company recently re-submitted the marketing application with the FDA for ONS-5010. It expects to learn of a potential PDUFA date by the end of October, with the potential FDA approval in late August 2023.

Chardan notes that ONS-5010 is being developed as an ophthalmic formulation of Roche Holdings AG's (OTC: RHHBY) Avastin (bevacizumab) that was initially approved in 2004 for metastatic colorectal cancer.

But it has been widely adopted for off-label use by eyecare practitioners as an effective treatment for several retinal diseases.

Despite several approved anti-VEGF treatments available for wet AMD, off-label Avastin remains the treatment of choice, accounting for ~50% share of the anti-VEGF market, primarily driven by comparable efficacy and safety at a much lower cost ($50-$100 for Avastin injection compared to ~$2k for treatments from Regeneron Pharmaceuticals Inc (NASDAQ: REGN) and Novartis AG (NYSE:NVS).

We believe it is unlikely that practitioners will move away from bevacizumab, so providing an option for an FDA-approved ophthalmic formulation of the drug at a reasonable price point would likely be met with enthusiasm. 

Price Action: OTLK shares are up 6.25% at $1.19 on the last check Tuesday.

Photo by Aline Berry from Pixabay