Leerink starts Iterum Therapeutics at OP; PT $18

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Leerink launched coverage of Iterum Therapeutics (NASDAQ:ITRM) with an “outperform” rating and price target of $18. The stock closed at $12 on June 18.

Iterum is developing an IV and oral formulation of sulopenem for both uncomplicated and complicated urinary tract infections and complicated intra-abdominal infections.

Analyst Ami Fadia writes that sulopenem targets two key unmet needs: as a new antibiotic, it can target rising resistance rates to fluoroquinolones and as an oral penem, it can allow earlier patient discharge from IV to oral on the same molecule class.

“Based on a triangulation of data points, we believe that sulopenem has better than even odds of success heading into three Phase 3's expected to read out in the second half of 2019,” she said.

Should the data be positive and sulopenem be approved, “we believe the differentiated profile could generate more than $400-million in 2025 estimated sales (before risk-adjustment), with more than 80% coming from urinary tract infection and more than 90% coming from the oral,” she added.

Ms. Fadia said this is a large 20 million-plus patient population predominantly treated with generics, but with rising resistance rates to current treatments in the 20% to 30% range, we believe the total addressable market size is more than $2-billion, of which we believe sulopenem can gain meaningful share.”

Stephen Kilmer