Citius (CTXR) May Be Among the Best Biopharma Value Plays
Multiple near-term catalysts anticipated
Good day everyone,
We are continuing our coverage of Citius Pharmaceuticals, Inc. (NASDAQ: CTXR), a specialty pharmaceutical company that develops and commercializes critical care products.
Current price $1.35 per share
Outstanding shares (est.) 45.19M
Float (est.) 24.53M
Insider ownership 39.08%
CTXR shares have been showing gains recently as news about the development of their licensed Novellus stem cell treatment for Covid 19 got more coverage. This is a major development at CTXR. A similar treatment has been used on a limited basis in New York and China with a high rate of success.
On June 26, the FDA acknowledged that the company could apply for fast track designation and provided Citius with the chemistry, manufacturing, and control (CMC) requirements for the proposed trials. The Company plans to initiate actions on the FDA’s recommendations and follow up with the FDA with an Investigational New Drug (IND) application under the Coronavirus Treatment Acceleration Program (CTAP).
Seems like the FDA may be on team Citius as well.
The case for CTXR shares is simple. Their market cap of $55 million seems too low for a company with potential FDA approval just around the corner for a blockbuster product (Mino-Lok) with billion-dollar market estimates, and a prospective Covid 19 treatment on the horizon.
Let’s do a short CTXR review for some of our newer members.
Citius licenses pharma products from non-public entities with the intent to bring them through clinical trials, FDA approval, and finally exploiting the product’s value.
While CTXR has a handful of products in development, we believe that two of them may impact the share price in the near to mid-term. Those two are Mino-Lok, a product licensed from the MD Anderson Cancer Center, and its new stem cell-based treatment for Covid 19 patients licensed from Novellus, Inc.
The CTXR buzz lately has been about the potential Covid 19 treatment. Novellus’s patented process uses its exclusive non-immunogenic synthetic messenger ribonucleic acid (mRNA) molecules to create induced pluripotent stem cells (iPSCs) that, in turn, generate mesenchymal stem cells (MSCs) with superior immunomodulatory properties. MSCs have been shown to be safe in over 900 clinical trials and to be safe and effective in treating many inflammatory diseases, including Acute Respiratory Distress Syndrome, the main cause of death from Covid 19.
On June 30th, CEO, Myron Holubiak, appeared as a featured guest on TD Ameritrade Network’s “The Watch List” to discuss the stem cell therapy and their work with the FDA. Follow the link to view it: https://tdameritradenetwork.com/video/rB4AoXL0GEiBcwZknpUIFQ
The stem cell treatment for Covid 19 is exciting and the market could be huge. A similar treatment developed by Mesoblast Limited (MESO) was used in March-April as an emergency treatment for COVID 19 patients in New York with ARDS and on a ventilator. The results of the treatment indicated 83% survival (10/12). MESO has a market cap of $1.42 billion, CTXR has a market cap of only $55 million.
Mino-Lok®, a combination of three FDA approved compounds, is used to treat infected Central Venous Catheters (CVCs). Quite simply, Mino-Lok gets administered through an IV for two hours a day. And it works. The company is in a Phase III trial and reached their 50% level of patients treated last fall. The next trial data will be the 75% level of patients treated, scheduled to be completed very soon. Data for the Mino-Lok clinical trials through 2B indicated virtually 100% efficacy.
According to DelveInsight, the potential market size for Mino-Lok® in the global market could reach $1.84 billion in 2028, up from $1.24 billion in 2017.
Mino-Lok has the 75% enrollment data due soon and its likely to cause a change in the company share price when it does. Many followers of CTXR assume the data may be positive.
CEO Myron Holubiak said recently “Some of our investigators have told us that if Mino-Lok were approved by the FDA, they would already be using it.” We cannot think of a better accolade for the product.
Mino-Lok has the potential to become THE standard of care for infected central venous catheters.
Both products could have near-term catalysts. Development of the Novellus stem cell treatment may generate a lot of catalysts as it is on a fast development program. Examples could be the beginning of human trials or the release of any efficacy data.
When CTXR releases Phase III data for Mino-Lok, we think the shares will experience significant gains and that data may be coming real soon.
5/19/2020 HC Wainwright Reiterated Rating Buy $4.00
The bottom line on CTXR shares is simple. A market cap of $55 million seems too light for a company so close to product approval with a potential annual market over one billion dollars.
We will be back with a full report soon,
The Traders News Group
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