Adcom Outcome For Lipcocine's Testosterone Drug Punctures Stock; Canaccord Downgrades

Lipocine Inc LPCN, a pharma company focusing on men's and women's health, announced Wednesday the FDA's Bone, Reproductive and Urologic Drugs Advisory Committee, voted against the benefit/risk profile of TLANDO, its oral testosterone product candidate for testosterone replacement therapy in adult males.

The PDUFA goal date for the candidate is set for May 8.

The Analyst

Canaccord Genuity analyst Dewey Steadman downgraded Lipocine from Buy to Hold and lowered his price target from $11 to $2.

The Thesis

The FDA panel was largely worried about the completeness and consistency of the data presented, Steadman said in a Thursday note. Panel members didn't back the drug up due to CV safety, unreliable serum readings and insufficient stopping criteria, Steadman added.

The analyst said that panel members who backed the drug had same concerns, but felt the benefits outweigh risks for hypogonadal patients.

Despite the thumbs down from the FDA panel, the drug could ultimately be approvable if appropriate blood pressure data and other items are presented to the FDA.

"However, the timing and scope of such submissions are yet to be determined and we think LPCN shares will be rangebound at current levels until a clear path to approval is forged," Canaccord Genuity said.

Price Action

Shares of Lipocine gained about 1.5 percent over the past year. The stock Thursday plunged 45 percent to $1.90.

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