Mizuho Remains Bullish On This Small-Cap Stock's Migraine Candidate, But Why Did It Cut Price Target

Mizuho Securities says that the Satsuma Pharmaceuticals Inc STSA story is essentially unchanged. It remains bullish on STS101's potential as an effective, safe, and reliable intranasal dihydroergotamine (DHE) for migraine.
It has adjusted its model to align STS101 pricing to Impel Pharmaceuticals Inc's IMPL migraine treatment, Trudhesa.
According to Drugs.com, Trudhesa costs around $900 per pack of four doses.
The model update lowers the price target to $13 from $15, with a Buy rating.
The management reaffirmed the timing of topline data for the pivotal SUMMIT trial in 4Q22, followed by a potential STS101 US marketing application filing in 1Q23.
Related: Satsuma's STS101 Shows Favorable Pharmacokinetic Profile, Tolerability In Early-Stage Study.
The long-term safety ASCEND trial is also expected to read out in 2H22.
Satsuma ended 1Q22 with a cash balance of $80.6 million, sufficient to fund operations into 2H23 and through projected completion of the STS101 Phase 3 program and potential marketing application filing.
Mizuho expects R&D expenses to trend upward in 1H22 and then taper down later as SUMMIT and ASCEND wrap up. It has also adjusted SG&A expenses, which assume pre-launch commercial activities to potentially commence later in 2023.
Price Action: STSA shares are up 2.60% at $2.70 during the market session on the last check Friday.