We have said it before, and we will stress it once again, one of the best ways for big pharmaceuticals and biotech companies to grow is through acquisitions. In a new report, Cowen sees the potential for super-mergers and a large group of smaller targets that may be in the sights of bigger companies now.
The Cowen team has gone through the biotech sector and pinpointed various companies with specialty drugs and treatments. We screened the list for one top company in each category that could be buyout candidates, and also ones that are rated Outperform at Cowen.
This biopharmaceutical company is a potential buyout candidate in ophthalmology. Ocular Therapeutix Inc. (NASDAQ: OCUL) is focused on the development and commercialization of innovative therapies for diseases and conditions of the eye using its proprietary hydrogel platform technology. Its lead product candidates are in Phase 3 clinical development for post-surgical ocular inflammation and pain, and Phase 2 clinical development for glaucoma and allergic conjunctivitis.
The stock got crushed recently when the eye pain and inflammation treatment OTX-DP did not meet one of its goals in a late-stage clinical trial. The company is meeting with the FDA to discuss results.
The Cowen price target for the stock is $49. The Thomson/First Call consensus target is a whopping $52.33, but that may be coming in soon. Shares closed Wednesday at $21.55.
Kythera Biopharmaceuticals Inc. (NASDAQ: KYTH) is a clinical-stage biopharmaceutical company focused on the discovery, development and commercialization of novel prescription products for the aesthetic medicine market. The company’s leading drug ATX-101 is for treating submental fat, or what is called double-chins. ATX-101 is patented formulation of a pure, non-animal-derived version of deoxycholic acid that enables the breakdown of dietary fat. An FDA action is expected literally any day now.
Previously, the FDA’s Dermatologic and Ophthalmic Drugs Advisory Committee voted unanimously to support the approval of its pipeline ATX-101, so it would seem that the likelihood of a positive outcome could be expected.
The Cowen price target is $85, and the consensus target is $64.40. Shares closed Wednesday at $46.65.