A.G.P./Alliance ups Titan Pharma PT to 65 cents from 45 cents

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A.G.P./ Alliance Global Partners raised its price target for Titan Pharmaceuticals (NASDAQ:TTNP) to 65 cents from 45 cents after the company’s third quarter results exceeded forecasts. The stock closed at 40 cents on Nov. 15.

Analyst Ben Haynor writes that Titan’s revenue of $1.7-million significantly exceeded his estimate of $100,000, with product revenue about 150% ahead of expectations.

“Naturally, we are pleased with the company's financial results for the third quarter, but other developments increase our confidence in the company's success going forward,” he added.

“Transitioning from a company almost exclusively focused on science to a commercial enterprise is a challenge, unless one has a strong product and a solid team and plan,” Mr. Haynor said. “The strategy management has laid out in recent investor presentations appears not only to be coming together on plan, but perhaps even faster than anticipated.”

For example, on the company's conference call, “we were most excited about the color provided regarding payers,” he added.

Mr. Haynor said that because Titan's Probuphine is a six-month implant for the treatment of opioid use disorder, 100% of patients would be compliant at six months, barring early removal. “We think this will resonate with payers and drive nearly universal reimbursement as time goes on.”

In addition to reimbursement, he said Titan's pilot program with the Nevada Center for Behavioral Health appears to be tracking on or ahead of schedule and the company continues to expect a decision on European clearance of Probuphine in the first half of next year.

Following the stronger than expected product sales performance in the third quarter, Mr. Haynor now forecasts revenue for all of 2018 at $5.7-million, up from $4-million, largely driven by the company’s third quarter performance. He also doubled his product revenue forecast for the fourth quarter.

For 2019, he now expects revenue of $4.7-million, compared with an earlier estimate of $4.4-million. “We think the company could do significantly better than what we have modeled for 2019, but we would rather maintain a conservative stance as we see how the newly-hired sales reps ramp productivity. Similarly, we have increased our 2020 revenue estimate by about 10% to $13.7-million from $12.4-million previously,” he added.

Abby Hardy