On Monday, Roth/MKM adjusted its outlook on Zevra Therapeutics, Inc. (NASDAQ:ZVRA) shares, reducing the price target to $19.00 from the previous $22.00, while continuing to endorse the stock with a Buy rating. The firm cites several factors influencing this decision, including the company's financial position and recent developments in its clinical trials and product sales.
Zevra Therapeutics concluded the fourth quarter of 2023 with a cash reserve of $67.7 million, which is expected to fund its operations into the year 2026. The company's Phase 2 KP1077 trial for idiopathic hypersomnia (IH) has yielded positive results, paving the way for an End of Phase 2 (EoP2) meeting with regulatory authorities and informing the design of the forthcoming Phase 3 trial.
Furthermore, Zevra's New Drug Application (NDA) for arimoclomol is progressing, with a Prescription Drug User Fee Act (PDUFA) date set for late third quarter of 2024. Anticipation is building around the potential Advisory Committee (AdComm) meeting that usually precedes a PDUFA decision.
The company's financial report also highlighted a nearly 40% quarter-over-quarter increase in 4Q23 royalties from AZSTARYS, reaching $1.2 million. This growth in prescriptions led to the achievement of a $10 million sales milestone in the same quarter. Additionally, Zevra has been actively promoting OLPRUVA since January, and although sales began in the fourth quarter of 2023, the initial figures were included in the report.
InvestingPro Insights
As Zevra Therapeutics, Inc. (NASDAQ:ZVRA) navigates through its clinical trials and product sales, understanding the company's financial health and market performance becomes crucial. An InvestingPro analysis reveals a mixed but insightful picture. The company's aggressive share buyback strategy signals management's confidence in the company's value. Additionally, Zevra's strong cash position, with more cash than debt on its balance sheet, provides a solid foundation for its operations and development efforts.
InvestingPro Data indicates a significant revenue growth of 162.58% for the last twelve months as of Q4 2023, with an even more remarkable quarterly revenue growth rate of 469.94% in Q4 2023. The gross profit margin stands impressively at 89.28%, underscoring the company's ability to maintain profitability on its products. However, it's worth noting that the company is not currently profitable, with an adjusted P/E ratio of -5.17, and analysts do not anticipate profitability this year. The stock's price volatility is also evident, with a 1-month price total return of -18.08%, which could be of interest to certain investors.
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