Krystal Biotech Inc. (KRYS:NASDAQ) applied to the U.S. Food and Drug Administration (FDA) for approval of Vyjuvek in dystrophic epidermolysis bullosa, a genetic skin condition causing blisters and wounds, reported H.C. Wainwright & Co. analyst Joseph Pantginis in a June 22 research note.
Vyjuvek is a redosable gene therapy in gel form, previously called B-VEC, short for beremagene geperpavec.
"Data support approval," Pantginis noted. "With the positive pivotal results, we see Krystal positioned well for a successful regulatory path forward."
The analyst reiterated the therapeutic was shown in the GEM-3 and GEM-1/2 clinical trials to be effective on chronic and recurring wounds and safe. In GEM-3, for instance, Vyjuvek met the primary and secondary endpoints of complete wound healing.
Also in the therapeutic's favor, Pantginis pointed out, is the handful of designations the FDA granted Vyjuvek during its development phase. They are rare pediatric disease, orphan drug, fast track, regenerative medicine advanced therapy (RMAT) and PRIority MEdicines (PRIME).
"Thanks to the RMAT designation, Krystal has been in constant communication with the FDA, which significantly derisks the next steps," commented Pantginis.
With approval likely, Krystal has been preparing to commercially launch Vyjuvek. To meet demand for it, the company has one manufacturing facility up and running and a second scheduled to come online this year.
"According to management, the materials and equipment necessary to ensure commercial readiness was done in advance so that the global supply constraints related to the pandemic are not expected to impact the Vyjuvek launch or the earlier stage programs, at least to the end of 2023," Pantginis wrote.
An estimated 9,000 people in the world, of which about 3,000 are the U.S., have dystrophic epidermolysis bullosa (DEB). Pantginis explained this total is likely low given the paucity of global gene testing.
In light of this factor, Krystal launched a genetic testing program called Decode DEB to help with proper and timely diagnosis of the skin disorder. In other awareness efforts, the company continues to educate physicians, patients and U.S. payers about dystrophic epidermolysis bullosa and the needs of individuals who have it.
Krystal is pursuing opportunities for Vyjuvek in other regions, too, like Japan and Europe. Regarding the latter, the company is on track to submit a marketing authorization application this quarter for approval of this treatment in the European Union, a potential catalyst for the biotech's stock.
H.C. Wainwright has a Buy rating and a $107 per share price target on Krystal. Its current share price is around $68.09.
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Disclosures for H.C. Wainwright & Co., Krystal Biotech Inc., June 22, 2022
H.C. Wainwright & Co, LLC (the “Firm”) is a member of FINRA and SIPC and a registered U.S. Broker-Dealer. I, Joseph Pantginis, Ph.D., and Emanuela Branchetti, Ph.D., certify that 1) all of the views expressed in this report accurately reflect my personal views about any and all subject securities or issuers discussed; and 2) no part of my compensation was, is, or will be directly or indirectly related to the specific recommendation or views expressed in this research report; and 3) neither myself nor any members of my household is an officer, director or advisory board member of these companies. None of the research analysts or the research analyst’s household has a financial interest in the securities of Krystal Biotech, Inc. (including, without limitation, any option, right, warrant, future, long or short position).
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The research analyst principally responsible for preparation of the report does not receive compensation that is based upon any specific investment banking services or transaction but is compensated based on factors including total revenue and profitability of the Firm, a substantial portion of which is derived from investment banking services. The firm or its affiliates received compensation from Krystal Biotech, Inc. for non-investment banking services in the previous 12 months.
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