Piper Jaffray Reiterates Overweight on XenoPort (XNPT)

Piper Jaffray is out with its report today on XenoPort XNPT, reiterating Overweight. In a note to clients, Piper Jaffray writes, "Yesterday, Xenoport announced that a Phase III study for XP19986, in multiple sclerosis patients with spasticity will be run under a Special Protocol Assesment. The FDA also wants a 6-month open-label extension and pharmacokinetic study. We believe this could put XNPT in a position to file for approval in late 2012 or 1H13. We continue to view the spasticity opportunity as a low-risk shot-on-goal given that conventional baclofen is approved and widely used in this setting. With greater visibility for AP, the recent FDA approval of Horizant in restless leg syndrome and a potential label expansion in post-herpetic neuralgia, plus strong intellectual property for both agents, we believe XNPT, at a market cap of around $280M, is trading at an attractive risk/reward. We reiterate our Overweight rating and $14 PT." Shares of XNPT closed Monday at $8.16, up 1.05% from Thursday's close.