A Feb. 26, 2018 research note indicated that Zacks Small-Cap Research initiated coverage on RXi Pharmaceuticals Corp. (RXII:NASDAQ) and valued it at $20 per share, which compares to where the stock is trading today at around $2.72 per share, a greater than 600% upside. The target price is based on "our estimates for a 2023 launch of RXI-109 and a 2022 launch of Samcyprone, both through the efforts of a partner," noted analyst John Vandermosten. RXI-109 and Samcyprone are the company's most advanced assets, targeting potential use for certain dermal and ocular conditions.
Vandermosten explained that RXi "is developing its self-delivering interference RNA (sd-rxRNA) technology platform, which is able to silence the expression of proteins inside cells and thereby impact a substantially broad range of diseases."
RXI-109 is currently being evaluated in trials to treat dermal scarring and retinal scarring, Vandermosten reported. A phase 2 clinical trial in dermal scarring is done, with the next step being a Phase 2b study. Zacks anticipates approval and launch of RXI-109 in dermal scarring in 2023. In the latter indication, retinal scarring, which is in a later stage, analysis of data collected in a Phase 1/2 trial is underway. Zacks expects approval and launch of RXI-109 in retinal scarring in 2024.
As for the clinical progress of Samcyprone, data are being collected for the Phase 2a study in warts, or verruca vulgaris. Topline results should be released in H1/18. Zacks anticipates approval and launch of Samcyprone for warts in 2022.
RXi intends to obtain a partner to fund and further develop these three programs, two dermatologic and one ophthalmologic, and employ the capital generated from the transfer of rights to support its immuno-oncology efforts, Vandermosten noted. He purported that "a favorable investment and regulatory environment are supportive of immuno-oncology and should allow for rapid entry into the clinic."
As for RXi's immuno-oncology candidates, there are three, and all are in a development or preclinical stage. They are:
- RXI-762, an sd-rxRNA targeting PD-1 in solid tumors
- RXI-804, an sd-rxRNA targeting TIGIT in solid tumors
- An undisclosed agent, an sd-rxRNA targeting undisclosed targets in an undisclosed immuno-oncology indication.
"The company anticipates that it can place an oncology indication in the clinic in the next 12 to 18 months," Vandermosten wrote.
Along with all of the above sd-rxRNA immuno-oncology compounds , RXi has two others, for dermatological indications. They qualify as cosmetics under federal regulatory rules and, therefore, don't require pre-marketing approval. They are:
- RXI-231, an sd-rxRNA targeting tyrosinase for uneven skin tone/pigmentation, which is in the functional and safety testing phase
- RXI-185, an sd-rxRNA therapy targeting MMP1 for wrinkles/skin laxity, which is further along, in the consumer testing phase.
As for these candidates, other than RXI-109 and Samcyprone, in RXi's portfolio, they "may eventually generate revenues," wrote Vandermosten.
The analyst offered these main reasons to own RXi:
- A versatile platform with broad applicability and a distinctive delivery mode
- Multiple ways to general revenue, including in- and out-licensing
- An ample pipeline of sd-rxRNA candidates in several indications
- A compelling safety and efficacy profile in Phase 2 studies
- Significant end markets for warts
- Well-defined markets for scarring with minimal direct competitors
- Global rights to intellectual property.
Vandermosten concluded, "With multiple monetizable indications in dermatology, ophthalmology and warts, RXi is in a strong position to advance its lead sd-rxRNA candidates to approval and support its developmental oncology pipeline."
Want to read more Life Sciences Report articles like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see recent articles and interviews with industry analysts and commentators, visit our Streetwise Interviews page.
Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provide services to Streetwise reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following company mentioned in this article is a billboard sponsor of Streetwise Reports: None. Click here for important disclosures about sponsor fees.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.
Disclosures from Zacks Small-Cap Research, RXII Pharmaceuticals Inc., Feb. 26, 2018
ANALYST DISCLOSURES I, John Vandermosten, hereby certify that the view expressed in this research report accurately reflect my personal views about the subject securities and issuers. I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the recommendations or views expressed in this research report. I believe the information used for the creation of this report has been obtained from sources I considered to be reliable, but I can neither guarantee nor represent the completeness or accuracy of the information herewith. Such information and the opinions expressed are subject to change without notice.
INVESTMENT BANKING AND FEES FOR SERVICES
Zacks SCR does not provide investment banking services nor has it received compensation for investment banking services from the issuers of the securities covered in this report or article.
Zacks SCR has received compensation from the issuer directly or from an investor relations consulting firm engaged by the issuer for providing non-investment banking services to this issuer and expects to receive additional compensation for such non-investment banking services provided to this issuer. The non-investment banking services provided to the issuer includes the preparation of this report, investor relations services, investment software, financial database analysis, organization of non-deal road shows, and attendance fees for conferences sponsored or co-sponsored by Zacks SCR. The fees for these services vary on a per-client basis and are subject to the number and types of services contracted. Fees typically range between ten thousand and fifty thousand dollars per annum. Details of fees paid by this issuer are available upon request.
SCR Analysts are restricted from holding or trading securities in the issuers that they cover. ZIR and Zacks SCR do not make a market in any security followed by SCR nor do they act as dealers in these securities. Each Zacks SCR Analyst has full discretion over the Valuation of the issuer included in this report based on his or her own due diligence. SCR Analysts are paid based on the number of companies they cover.
SCR Analyst compensation is not, was not, nor will be, directly or indirectly, related to the specific valuations or views expressed in any report or article.
