Stifel Starts Biotie At Buy, Says Lead Product Can 'Meaningfully Improve' Parkinson's Patients

In a report published Monday, Stifel analyst Stephen D. Willey initiated coverage of Biotie Therapies Oyj (ADR) BITI with a Buy rating and price target of $30. "We believe Biotie's lead product candidate, tozadenant – a highly selective/orally administered adenosine A2a receptor antagonist – has the potential to meaningfully improve symptomatic control in Parkinson's disease (PD) patients not adequately controlled with standard-of-care levodopa alone," Willey stated. In addition, the stock offers a favorable risk/reward profile, given the visibility into the impending P3 tozadenant development program, along with additional optionality due to Biotie Therapies' earlier stage/first-in-class pipeline, as well as access to an expected steady source of longer term collaborative revenue in Selincro. "We believe tozadenant represents a best-in-class A2a antagonist capable of filling a significant innovation gap in PD symptom management. We believe tozadenant's improved pharmacology overcomes some of the safety/efficacy concerns historically associated with the development of competitive A2a antagonists," Willey mentioned. The analyst also expressed optimism regarding the P3 trials, which are to be initiated soon, being able to replicate the positive results of the P2b trial, while expecting the drug to see peak US sales of about $850 million. The analyst also believes that the pipeline optionality is currently being underappreciated by the company and investors. In addition, with Selincro now commercialized across nearly 30 countries in Europe, the analyst expects the Selincro collaboration to offer "a potentially meaningful source of non-dilutive funding."