In a March 8 research note, H.C. Wainwright & Co. analyst Ed Arce reported that DURECT Corp. (DRRX:NASDAQ) continues advancing clinical trials evaluating its lead product candidate DUR-928, and that data readouts in three indications are expected in H2/19.
One of those indications is alcoholic hepatitis (AH), which is "emerging as a top priority indication for DUR-928," noted Arce. Results later this year will come from a Phase 2a open label, multicenter dose escalation study currently in progress.
The latest news related to this trial is from March 7, when DURECT announced it had advanced the study to Part B, which is for severe AH patients in the 90 mg dose cohort. "The company chose to move forward in light of the "positive results in both moderate and severe AH patients who were given the 30 mg doses and the rapid pace of enrollment in Part B," the analyst wrote.
Part A enrollment of moderate AH patients for the 90 mg dose continues. Both parts could advance to the final 150 mg dose if the dose escalation committee determines the safety and pharmacokinetic profiles are adequate.
Psoriasis is the second indication for which DUR-928 data will be forthcoming. DURECT has scheduled enrollment for the Phase 2a proof-of-concept trial of topical DUR-928 for mild to moderate plaque psoriasis to begin by the end of this month. This 20-patient study will consist of four weeks of treatment, then a follow-up period of the same duration.
Third, data are anticipated in nonalcoholic steatohepatitis (NASH), specifically the Phase 1b trial for which enrollment should begin this month. Also a proof-of-concept trial, it will enroll about 60 patients to be divided into three equivalent groups, each to receive a different dose, low, middle or high, of DUR-928. "Positive results from this new trial (expected in H2/19) could segue into a larger efficacy trial in 2020," Arce pointed out.
Also in the report, Arce briefly summarized DURECT's Q4/18 financials, indicating revenue during the quarter was $3.6 million. At year-end 2018, the company had $34.5 million in cash and cash equivalents, along with $20.5 million of debt from a term loan.
H.C. Wainwright & Co. has a Buy rating and a $3 per share price target on DURECT, whose stock is currently trading at around $0.79 per share.
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Disclosures from H.C. Wainwright & Co., DURECT Corporation, Earnings Update, March 8, 2019
Investment Banking Services include, but are not limited to, acting as a manager/co-manager in the underwriting or placement of securities, acting as financial advisor, and/or providing corporate finance or capital markets-related services to a company or one of its affiliates or subsidiaries within the past 12 months.
I, Ed Arce and Thomas Yip , 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 analystís household has a financial interest in the securities of DURECT Corporation (including, without limitation, any option, right, warrant, future, long or short position).
As of February 28, 2019 neither the Firm nor its affiliates beneficially own 1% or more of any class of common equity securities of DURECT Corporation.
Neither the research analyst nor the Firm has any material conflict of interest in of which the research analyst knows or has reason to know at the time of publication of this research report.
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 does not make a market in DURECT Corporation as of the date of this research report.
H.C. Wainwright & Co., LLC and its affiliates, officers, directors, and employees, excluding its analysts, will from time to time have long or short positions in, act as principal in, and buy or sell, the securities or derivatives (including options and warrants) thereof of covered companies referred to in this research report.