Analyst: Neurotrope's Bryostatin-1 Trial Data Justifies Additional Studies

Shares of Neurotrope Inc NTRP, a biopharmaceutical company focused on developing a therapy called bryostatin-1 for the treatment of Alzheimer's disease, lost more than half of its value on Monday after a planned release of clinical data failed to impress investors.

Investors On A Rollercoaster Ride

Neurotrope saw its shares gain more than 15 percent on Friday on high anticipation of Monday's results. But the company, unfortunately, revealed around 90 patients who received a 20mg dose of bryostatin did not see any statistically significant improvement.

While many investors are throwing in the towel Monday, not all on Wall Street are following suit. Analysts at Aegis Capital found sufficient positives in the clinical story for the company to move on to larger studies with longer treatment periods.

Analyst Commentary

Aegis' Robert LeBoyer commented in a research report Monday that while the company's findings are not what investors were expecting, the positives may be taking a back seat to the negatives. Specifically, patients who received bryostatin realized an improvement in their Severe Impairment Battery score, while untreated patients are expected to show a decline in their SIB score.

LeBoyer continued that a six-month long study could show "greater treatment effect and statistical significance" especially if the difference in SIB scores between treated and un-treated patients widen.

"In a field where universal failure is expected, Bryostatin-1 showed an improvement in memory," the analyst emphasized. "Our opinion, the study met its objective of showing that the drug has sufficient activity to move to a larger study with a longer treatment period."

However, based on Monday's developments, the analyst feels it necessary to review his estimates and price target on the stock, especially since his valuation is based on the company's first year of expected profitability in 2020 and also discounted from his 2021 earnings per estimate of $5.96.

Shares were previously Buy rated with a $31 price target.

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