In a Dec. 20 research note, analyst Jeffrey Cohen reported that Ladenburg Thalmann initiated coverage on Aytu Bioscience Inc. (AYTU:NASDAQ) with a Buy rating and a $3.75 per share price target. In comparison, the company's current share price is $0.78. "We believe that Aytu BioScience should be valued in comparison with other innovative technological companies within the medical technology and biotechnology sectors and more specifically based on multiples to revenue at some time in the future," he added.
Cohen described this specialty pharmaceutical company's focus, strategy and opportunities. Aytu develops and globally commercializes products for hypogonadism, male infertility and insomnia. Specifically, it sells three products approved by the FDA and for which is has U.S. licenses: Tuzistra XR, a prescription cough medicine; Zolpimist, an insomnia remedy in an oral spray form; and Natesto, a nasal gel for men with hypogonadism, or low testosterone.
Aytu currently is evaluating Natesto's impact on men's health and reproductive system in a clinical trial that is underway. It is slated for completion in H1/19, after which final data will be released. "The interim data provide an additional benefit, beyond reduced concern of transference, to support utilization of Natesto as compared to alternative treatments," indicated Cohen.
Aytu is pursuing FDA approval of another product, MiOXSYS, which it sells in Canada, Australia and Mexico. It is an in vitro diagnostic test to measure oxidative stress in men with infertility. "We believe the company will continue to actively search and pursue various acquisition and licensing opportunities going forward," Cohen noted.
The company's strategy has been to concentrate on therapies for "conditions that can be assessed by primary care physicians and specialists," Cohen described. Aytu markets and sells its products through its domestic sales force of about 35 people and a network of distribution partners in roughly 50 countries, which it continues to bolster.
Aytu's current products are part of "large addressable markets of approximately $6.5–7 billion," into which the biopharma can expand by leveraging its "established commercial infrastructure," Cohen explained.
Further, these specific markets are growing, presenting additional opportunity for Aytu. For example, the testosterone replacement therapy market is expected to reach $3.4 billion by 2022. The sleep aid market, both prescription and over the counter, is anticipated to reach $101.9 billion by 2021. The cold and cough market is forecasted to reach $3 billion in solely the U.S. As for Aytu and its revenue overall, Ladenburg Thalmann estimates it will generate about $30.9 million in 2022.[NLINSERT]
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides 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 companies mentioned in this article are sponsors 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.
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 three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.
Disclosures from Ladenburg Thalmann, Aytu BioScience, Inc., December 18, 2018
ANALYST CERTIFICATION: I, Jeffrey S. Cohen, attest that the views expressed in this research report accurately reflect my personal views about the subject security and issuer. Furthermore, 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, provided, however, that:
The research analyst primarily responsible for the preparation of this research report has or will receive compensation based upon various factors, including the volume of trading at the firm in the subject security, as well as the firm’s total revenues, a portion of which is generated by investment banking activities.COMPANY SPECIFIC DISCLOSURES
Ladenburg Thalmann & Co. Inc. makes a market in Aytu BioScience, Inc.
Ladenburg Thalmann & Co. Inc. has managed or co-managed a public offering for Aytu BioScience, Inc. within the past 12 months.
Ladenburg Thalmann & Co. Inc received compensation for investment banking services from Aytu BioScience, Inc. within the past 12 months.
Ladenburg Thalmann & Co. Inc had an investment banking relationship with Aytu BioScience, Inc. within the last 12 months.