In a Sept. 26 research note, ROTH Capital Partners analyst Jerry Isaacson reported that AzurRx BioPharma Inc.'s (AZRX:NASDAQ) Phase 2 OPTION trial for lead candidate MS1819 in cystic fibrosis patients "answered all of the questions surrounding the treatment, all with positive results."
Isaacson explained that overall, the study, which compared MS1819 to the standard of care, or a pancreatic enzyme replacement therapy (PERT) regimen, demonstrated that MS1819 improved patients' coefficient of fat absorption. Also, it showed nitrogen absorption with MS1819 was comparable to that with PERT. Further, concerning the primary question and goal, the trial showed MS1819 to be safe.
"We find the market's reaction to the data unfortunate," given the results and given the company is now "poised for late stage development," he added.
In contrast to the market, ROTH considers AzurRx a stock with multibagger potential, as indicated by its target price on the biopharma of $10.20 per share. The company's current share price is around $0.61.
Isaacson discussed the efficacy and safety of MS1819 as demonstrated in the OPTION trial.
Regarding efficiency, he highlighted that the study importantly showed the coefficient of nitrogen absorption with MS1819, 93%, was comparable to that with PERT, 97%. "This result shows that a protease is not a necessary addition to MS1819, clearly validating the company's hypothesis," he commented.
Also, half of the OPTION patients achieved a coefficient of fat absorption that was not inferior to that obtained with PERT. This indicates the dose of MS1819 administered is efficacious but greater doses could yield a greater fat absorption benefits in a larger proportion of patients.
Regarding safety, in OPTION, AzurRx could only test an MS1819 dosing 2 grams per day despite the optimum dosing likely being higher. This was due to the U.S. Food and Drug Administration's (FDA's) concerns about the drug's safety, Isaacson pointed out. However, with the study results allaying that worry, the biopharma now can conduct a trial that "truly demonstrates the efficacy of MS1819."
As such, the next step is a Phase 2b/3 trial in which AzurRx will likely test higher doses of the enzyme. It also will administer MS1819 via an FDA-approved, enteric-coated capsule for optimal drug delivery.
The U.S.-based company has another Phase 2 trial of MS1819 underway, that one in patients with more chronic cystic fibrosis, with severe exocrine pancreatic insufficiency. The study is testing the administration of MS1819 in addition to the standard of care.
ROTH has a Buy rating on AzurRx.
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Disclosures from ROTH Capital Partners, AzurRx BioPharma Inc., Company Note, September 26, 2019
Regulation Analyst Certification ("Reg AC"): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.
ROTH makes a market in shares of AzurRx BioPharma, Inc., Inc. and as such, buys and sells from customers on a principal basis.
Shares of AzurRx BioPharma, Inc. may be subject to the Securities and Exchange Commission's Penny Stock Rules, which may set forth sales practice requirements for certain low-priced securities.
ROTH Capital Partners, LLC expects to receive or intends to seek compensation for investment banking or other business relationships with the covered companies mentioned in this report in the next three months.
