Synergy Pharmaceuticals Inc fka SGYPQ

[Snackman]

Tim Chiang Upbeat on These Two Biotech Players Circling FDA Approvals in 2018: Synergy Pharmaceuticals Inc., Progenics Pharmaceuticals
[SmarterAnalyst]
[e-mail] (Ben Mahaney)
SmarterAnalystJanuary 4, 2018

With Synergy Pharmaceuticals Inc (NASDAQ:SGYP) looking at exciting new leadership along with IBS-C treatment indication approval for Trulance by the end of this month and Progenics Pharmaceuticals, Inc. (NASDAQ:PGNX) prospectively garnering an FDA nod by the end of April for its orphan status asset for treatment of rare tumors, BTIG analyst Tim Chiang spotlights two biotech companies worth the bullish bet. (To watch Chiang's track record, click here)

Let's dive in:

Synergy Approaching a New and Improved Year for 2018

With Synergy cherry-picking its once Chief Commercial Officer Troy Hamilton as the new effective CEO, Chiang takes the news in bullish stride. Considering Synergy's top priority storming into the new year eyes a ramp up of chronic constipation asset Trulance (plecanatide), with fresh new leadership, the analyst is now "expecting a better year in 2018" for the drug maker.

In reaction, the analyst maintains a Buy rating on SGYP with a price target of $7, which implies a 188% upside from current levels.

Chiang writes, "Heading into 2018, we think there are several key items to focus on including increased payor access for Trulance, with major insurers like Aetna […] moving to Tier 2 preferred status, UnitedHealthCare […] removing its new to market block, and Cigna […] removing its prior authorization requirement for Medicare Part D Plans. In addition, major PBM’s including CVS Caremark […] and Prime Therapeutics will also be adding Trulance to their formularies."

With a prospective FDA approval decision waiting in the wings on the 24th of this month for the IBS-C treatment indication, the analyst believes this could prove to be a share driver for Synergy. Keep in mind, back in October, Synergy unleashed successful pooled data at the American College of Gastroenterology (ACG) meeting. Plecanatide's results showcased statistically significant results reached 12 weeks in against the placebo arm, which translates to two wins: both primary and secondary endpoints.

Moving forward, Chiang projects roughly $175 to $180 million of cash following Synergy's equity raise in November, which should assist the biotech company in realizing its "Second Tranche Borrowing Milesone" under the term loan agreement in place with CRG LP.

TipRanks highlights a strong bullish camp on Wall Street betting on Synergy stock, with all 5 analysts polled in the last 3 months unanimously rating a Buy on the biotech stock. With a whopping return potential of nearly 250%, the stock's consensus target price stands at $8.60.