?Dawson James - Dare' (DARE) - XACIATO Approved
Daré announced that the FDA has approved XACIATO (clindamycin phosphate vaginal gel, 2%, formerly known as DARE-BV1) for the treatment of bacterial vaginosis in females 12 years of age and older.
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BV1: A thermosetting bio-adhesive hydrogel formulated with clindamycin phosphate 2% as a first-line, single-administration treatment for bacterial vaginosis.
Market Opportunity? Bacterial vaginosis is the most common cause of vaginitis worldwide and is estimated to affect approximately 21 million women in the United States. Several therapeutic options for women exist but have insufficient clinical cure rates, require sequential daily administrations, or can be otherwise inconvenient for women to use. It is estimated that as many as 50% of women treated for bacterial vaginosis will experience a recurrence within 12 months of their treatment.
Price Target- No change. We have eliminated our therapeutic risk rate in our BV model but otherwise, our model and assumptions are unchanged. The effect on our valuation is de minimis.
Valuation: We assume that DARE-BV1 can be commercialized in 2022 and that Ovaprene can follow in the U.S. in 2023 and in the EU in 2025. For Sildenafil cream, we expect commercialization in the U.S. in 2024 and in the EU in 2025. We assume a 30% discount rate in our Free Cash Flow to the Firm (FCFF), Discounted EPS (dEPS), and Sum-of-the-Parts (SOP) models due to the risks associated with each product. This results in models that are equally weighted and rounded to the nearest whole number for a $3.00 price target.
Risks to our thesis include: (1) commercial; (2) clinical and regulatory; (3) partnership; (4) financial; and (5) legal and intellectual property.
Successful Trading is the art of minimizing long term risk and maximizing capital allocation.
