We are downgrading NPS Pharma to Underperform following the
lackluster performance of the company in the first quarter of 2014.
The company reported a wider-than-expected loss in the quarter as
revenues fell short of expectations. NPS Pharma trimmed its outlook
for Gattex (its sole marketed product) net sales in 2014 based on
sluggish sales in January and February. The company now expects net
sales in the range of $100 million to $110 million (old guidance:
$110 million to $120 million). Earnings estimates for 2014 as well
as 2015 are on the downswing. Given the disappointing situation, we
advise investors to get rid of the stock. Our target price is
$30.00 per share.
Headquartered in Bedminster, N.J. and founded in 1986, NPS
Pharmaceuticals, Inc. is a biopharmaceutical company which focuses
on developing and commercializing therapies for treating patients
suffering from rare diseases.
NPS Pharma's sole marketed product is Gattex (teduglutide). The
drug is available in the U.S. (since Feb 2013) as a subcutaneous
injection for treating adults with short bowel syndrome (SBS),
dependent on parenteral support.
Gattex was cleared in the EU in 2012 (European trade name:
Revestive). NPS Pharma expects to commence pricing/reimbursement
discussions with authorities in some EU countries during the
NPS Pharma expects to add another product Natpara (rhPTH [1-84])
to its portfolio later in the year. The company is looking to get
Natpara, which has been granted orphan drug status in the U.S. and
EU, approved for treating hypoparathyroidism. The candidate is
currently under review in the U.S. A decision from the FDA on
Natpara is expected by Oct 24, 2014. In 2013, NPS Pharma regained
the worldwide rights to Revestive and rhPTH 1-84 from Takeda.
Takeda marketed rhPTH 1-84 under the brand name Preotact for the
treatment of osteoporosis in some of its licensed territories.
NPS Pharma's pipeline also includes NPSP795 (autosomal dominant
hypocalcemia). NPS Pharma intends to make significant efforts to
advance the development of the candidate during the course of the
Revenues in 2013 climbed 19.1% to $155.6 million
NPS Pharmaceuticals, Inc. (NPSP): Read the Full
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