Mackie Research cuts Medicure to hold; PT to $6.50 from $7.60

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Mackie Research Capital downgraded Medicure (TSXV:MPH) to “hold from “buy” and cuts its price target to $6.50 from $7.60 after the company reported weaker than expected first quarter results. The stock closed at $5.99 on May 27.

Analyst Andre Uddin writes that the first quarter is usually a weak period for specialty pharma. Medicure’s first quarter revenue was $4.9-million, far behind Mackie’s estimate of $7.3-million and $6.1-million in the 2018 first quarter.

“We still view Zypitamag as Medicure’s key long-term growth driver. However, the sales growth is slow at this stage due to lack of sufficient reimbursement,” he said. “We expect Zypitamag sales to start ramping up in later 2019 as more payers cover the drug.”

Zypitamag is a new statin with a unique formulation containing magnesium that serves as a pharmaceutical alternative to Livalo.

Stephen Kilmer