BTIG starts electroCore at buy; PT $20

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BTIG initiated coverage of electroCore (NASDAQ:ECOR) with a “buy” rating and $20 price target. The stock closed at $14.64 on July 16.

electroCore has developed an FDA-cleared non-invasive vagus nerve stimulation device that has been shown to offer pain relief for patients with episodic cluster headache and migraine. 

Analyst Dr. Sean Lavin writes that electroCore has made some early progress on attaining coverage for gammaCore. However, current reimbursement is limited to just some 17 million commercial covered lives and could take some time to become routine. “But see gammaCore as a compelling offering for a desperate patient group without many other good options.”

He said the device’s non-invasive nature and essentially no side effects should lead to rapid adoption. “Outside of headache, we expect the device will also address other large opportunities in areas such as arthritis or other diseases involving inflammation in the future.” 

With the FDA risk out of the way, Dr. Lavin said electroCore is focused on a full U.S. launch for both indications in the third quarter. “We are impressed with preliminary legwork preparing the clinician community for the rollout, including vouchers for a free month of migraine treatment, a commercial registry, and an education program. Hundreds of clinicians have already prescribed gammaCore,” he added. 

Dr. Lavin said that withmany patients likely to require monthly prescription refills, “sales and margins should be compelling.”

Stephen Kilmer