HCW halves Agile Therapeutics PT to $4

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H.C. Wainwright halved its price target for Agile Therapeutics (NASDAQ:AGRX) to $4 from $8 after the company updated the regulatory status of Twirla, its weekly transdermal contraceptive patch. The stock closed at 69 cents on May 18.

“We have all along thought the primary approval sticking point was ultimately about Twirla's relative efficacy, but now it's just the sticking itself,” writes analyst Owen Livnat.

The prior complete response letter called out potential concerns on Twirla adhesion and the possible impact on efficacy, so Agile went into its Type A FDA meeting with a deluge of adhesion data and analyses showing no correlation of peeling or detachment with pregnancies, he said.

But according to the meeting minutes released last Friday, Mr. Livnat said the FDA division is now concerned with the patch detachment rate, and is “unmoved by Agile’s plan to deal with detached patches in practice.”

FDA recommended Agile go back to the drawing board and reformulate the patch, show improved adhesion, then prove bioequivalence to current Twirla or do another entire Phase 3.

Mr. Livnat said Agile is adamant that none of the above is necessary, there is no adhesion problem (no patches stick 100% of the time), and the inevitable detached patch is a labeling, education, and logistics issue, rather than an approvability roadblock. “Based on the data we’ve seen, we wholeheartedly agree,” he added.

Agile plans to enter Formal Dispute Resolution with the aim to refile the NDA and gain approval with the existing package. “We expect the Street to maintain an extremely dim view on Twirla prospects for now, but we are actually optimistic that reason will prevail, and this likely in-demand therapy will be approved, as is,” he said.

Stephen Kilmer