TherapeuticsMD Inc (NYSE: TXMD), is an innovative healthcare company focused on developing and commercializing products exclusively for women.
TXMD is primarily focused on developing and commercialize an asset called TX-004HR in a target indication of TX-004HR for the treatment of moderate-to-severe vaginal pain during sexual intercourse (dyspareunia), a symptom of vulvar and vaginal atrophy (VVA) due to menopause.
The company stock has had a strong few months in the recent past. It has almost doubled between May and September 2017. The stock continues to show momentum and there’s plenty more upside for anyone looking to pick up an exposure in this biotechnology play.
On Sep14, 2017, TherapeuticsMD Announces Submission of Additional Endometrial Safety Information to the New Drug Application for TX-004HR.The Company has scheduled a formal meeting with the FDA for November 3, 2017, at which the Company expects to learn if this additional endometrial safety data addresses the lack of long-term safety identified in the Complete Response Letter for the NDA for TX-004HR.The Company currently plans to re-submit the NDA for TX-004HR shortly after the meeting.
The submission includes a comprehensive, systematic review of the medical literature on the use of vaginal estrogen products and the risk of endometrial hyperplasia or cancer, including the safety data from the recently published Women’s Health Initiative Observational Study of vaginal estrogen use in postmenopausal women and information on the relevance of the first uterine pass effect for low-dose vaginal estrogen products.
As per management, TXMD’s comprehensive, systematic review of the medical literature on the use of vaginal estrogen products is compelling and the totality of the data demonstrates that these products are not associated with increased risks of endometrial hyperplasia or cancer.
The upcoming milestone is an important step towards the approval of TXMD’s NDA for TX-004HR and the company looks forward to meeting with the FDA in November to discuss its path forward.
Previously, TherapeuticsMD also announced Publication of Manuscript on the Women’s Health Initiative Observational Study of Vaginal Estrogen Use in Postmenopausal Women. The publication re-affirmed no significant difference in the risk of invasive breast cancer, stroke, colorectal cancer, endometrial cancer, and venous thromboembolism in vaginal estrogen users vs nonusers and Lower risk of cardiovascular disease, hip fracture, and all-cause mortality in vaginal estrogen users with intact uterus vs nonusers with an intact uterus.
There’s abundant historical data already available that signals to the long-term safety and viability of these sort of asset and there doesn’t look to be any material reason why TherapeuticsMD won’t be able to get the asset approved eventually.
Driven by these developments along with positivity associated with the upcoming FDA Review for TX-004HR, analysts have revised their outlook on the company with a medium-term price target of $18.93. TXMD remains an attractive buy at its current price level of ~$6.5, with its promising product offerings that are well positioned to capture sizeable market share in the hormone therapy market.
About the Company: TherapeuticsMD, Inc. is an innovative healthcare company focused on developing and commercializing products exclusively for women. With its SYMBODA™ technology, TherapeuticsMD is developing advanced hormone therapy pharmaceutical products to enable delivery of bio-identical hormones through a variety of dosage forms and administration routes.
Product Pipeline: The Company’s late stage clinical pipeline includes two-phase 3 product candidates:
- TX-001HR for treatment of moderate-to-severe vasomotor symptoms (VMS) due to menopause.
- TX-004HR for treatment of moderate-to-severe vaginal pain during sexual intercourse (dyspareunia), a symptom of vulvar and vaginal atrophy (VVA) due to menopause.
- The company also manufactures and distributes branded and generic prescription prenatal vitamins under the vitaMedMD® and BocaGreenMD® brands.
About Vulvar and Vaginal Atrophy (VVA): An estimated 32 million women in the United States are currently suffering from symptoms of VVA, and only 2.3 million (7 percent) are currently being treated with prescription therapy. VVA symptoms can range from mild to severe and include dyspareunia, vaginal dryness, urinary tract infections, and vaginal bleeding associated with sexual activity. Vaginal dryness and dyspareunia are considered the most bothersome symptoms of VVA. Because of the chronic nature of VVA due to menopause, its symptoms will not likely resolve without intervention.
Other Recent Developments
- Pre-NDA meeting for TX-001HR, the company’s investigational bio-identical hormone therapy combination of estradiol and progesterone in a single, oral softgel for the treatment of moderate-to-severe vasomotor symptoms due to menopause, scheduled with the FDA at the end of August 2017. The company anticipates that it will submit the NDA for TX-001HR in the fourth quarter of 2017.
- Dismissal without prejudice of the primary federal securities class action lawsuit recently filed against the company.
- Grew the company’s intellectual property portfolio to a current total of 158 patent filings, including 82 international filings, with one allowed and 17 issued U.S. patents.
2nd Quarter 2017 Financial Results:
Net revenue from the company’s prescription prenatal vitamin business was approximately $4.3 million for the second quarter of 2017 compared with net revenue of approximately $4.4 million for the prior year’s quarter. These changes were primarily due to a decrease in the number of units sold.
Cost of goods sold was approximately $0.7 million for the second quarter of 2017, compared with approximately $1.1 million for the prior year’s quarter.
Net loss for the second quarter of 2017 was approximately $19.7 million, or $0.10 per basic and diluted share, compared with approximately $21.1 million, or $0.11 per basic and diluted share, for the second quarter of 2016.
At June 30, 2017, cash on hand was approximately $96.5 million, compared with approximately $131.5 million at December 31, 2016.
Key risk factors and potential stock drivers:
The company is optimistic of the positive outcome in the November 3 meeting. This meeting will be a critical catalyst for the company going forward.
The outcome of the upcoming milestones (as mentioned above) could be the near-term trigger for the company. Any non-favorable developments could impinge the business and financial risk profile of the company.
TXMD may not be able to successfully develop, launch and commercialize TX-004 or any other potential future development programs.
The company may experience financial, regulatory, or operational difficulties, which may impair its ability to commercialize their drug products. In fact, in the past, markets sold off on TherapeuticsMD heavily when the FDA issued the CRL to the company.
With the current cash reserves of $96.5 million and estimated cash burn of $35 million for the next 6 months, TXMD will have around ~$61 million by the time TX-004HR is approved. Thus, the company could announce a secondary offering to raise capital, which would dilute the existing share capital.
Stock Chart:
On Friday, September 15th, 2017, TXMD closed at $6.60 (up by 1.23%), with an average volume of 2.11 million shares exchanging hands. Market capitalization is $1.35 billion. The current RSI is 61.44.
In the past 52 weeks, shares of TXMD have traded as low as $3.50 and as high as $8.30
At $6.60, shares of TXMD are trading above its 50-day moving average (MA) at $5.80 and above its 200-day MA at $5.68
The present support and resistance levels for the stock are at $4.18 & $4.62 respectively.
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