HCW starts Adamas Pharma at buy; PT $45

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H.C. Wainwright launched coverage of Adamas Pharmaceuticals (NASDAQ:ADMS) with a “buy” rating and $45 price target. The stock closed at $27.06 on July 13. 

Adamas’ lead product, GOCOVRI, was approved in August 2017 in the U.S. to treat the dyskinesia (movement disorders) associated with Parkinson's disease (PD) patients, who are experiencing troublesome symptoms while on levodopa therapy. 

There are roughly one million PD patients in the U.S. alone, of which approximately 23% are likely to suffer from levodopa-induced dyskinesia, writes analyst Raghuram Selvaraju, who estimates that GOCOVRI could achieve peak sales of more than $700-million in the U.S. alone by the mid-2020s.

In addition, Adamas is developing the same active pharmaceutical ingredient in GOCOVRI, using an identical formulation approach, to treat walking impairment in patients suffering from multiple sclerosis (MS). 

The MS candidate, designated ADS-5102, is currently in a Phase 3 program, targeting MS patients with walking impairment. Mr. Selvaraju said the trial could read out data in 2019 and “we anticipate that ADS-5102 could be launched in late 2020, providing Adamas with a lucrative label extension opportunity.” 

The MS patient population is estimated at more than 500,000, of which 80% suffer from walking impairment. Sales in MS could approach $1-billion, he added.

Melane LaBelle Sampson