H.C. Wainwright Reiterates Buy Rating For Agile Therapeutics (NASDAQ: AGRX), Citing Growing Demand For Twirla, A Weekly Low Dose Birth Control Patch

H.C. Wainwright & Co, reiterated its buy rating on Agile Therapeutics, Inc. AGRX this month, setting a price target of $12 per share. The $12 price target is based on the 1:50 reverse split and the $7.5 million raised in Agile’s public offering in May. Despite challenges faced by the women’s healthcare company, its patented weekly birth control patch has seen a steady increase in demand, and the company is leveraging key partnerships to expand adoption even further. 

Enhanced Affordable Care Act Compliance Could Be A Major Tailwind for AGRX

The Affordable Care Act of 2010 guarantees contraceptive coverage at no extra cost for patients in all states. That includes coverage for a broad range of birth control methods including pills, rings, implants, emergency contraception, and, crucially, any new contraceptives approved by the FDA. 

Despite this guarantee, a 2022 investigation by the House Oversight Committee found that most insurers and pharmacy benefit managers (PBMs) are either excluding coverage or imposing cost-sharing requirements for over 30 contraceptive methods.

Agile’s Twirla®(levonorgestrel and ethinyl estradiol) transdermal system, for example, was excluded or required patients to pay as much as $178 in some health plans health the committee reviewed. The patch offers the lowest dose of estrogen available in a birth control patch and lasts for a full week. This makes it an important option for patients who want to avoid high doses of estrogen and who may struggle to take a daily pill.. Instead of a daily pill, Twirla users replace the patch applied directly on the skin once a week for three consecutive weeks, and do not wear a patch on the fourth week. 

The Biden Administration has been working to better enforce compliance with the coverage guarantees.Stronger enforcement of ACA coverage guarantees would help make the low-dose weekly Twirla patch available to millions of patients across the United States. 

Twirla Sales Continue To Climb In Spite Of Exclusions

Agile is already generating about $20 million in sales of Twirla, even in the current climate of inconsistent insurer compliance with the Affordable Care Act. It’s estimated to reach $25 to $30 million in net revenue by the end of 2023 as demand continues to grow for Twirla. 

Through its partnership with Afaxys,Agile could add multiple larger Planned Parenthood accounts this year as well as new accounts with non-340b clinics in California. 

340b is a federal program allowing clinics that treat low-income or uninsured patients – like Planned Parenthood – to buy prescription drugs at prices 25% to 50% lower than other clinics. So the potential to add non-340b accounts would create new revenue streams with wider margins than Agile’s current Planned Parenthood revenue. 

Agile’s partnership with NURX® – launched last year – is expected to start impacting earnings as soon as the third quarter of this year. The women’s telehealth platform delivers prescription birth control to patients across the United States. Twirla ise the exclusive contraceptive patch offered on the platform. 

Between growing revenue from Twirla and an estimated 40% decrease in operating expenses year-over-year, the women’s healthcare company could reach breakeven cash flow in late 2023 or early 2024. Looking further forward, H.C. Wainwright forecasts Twirla sales to reach $95 million by the end of 2027. 

Featured photo by Reproductive Health Supplies Coalition on Unsplash.

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