Prometic Life Sciences has 172% upside, says Paradigm Capital

On Friday, Prometic announced that it had increased its ownership in NantPro Biosciences, gaining control of the company and a larger portion of future revenue associated with intravenous immunoglobulin, or IVIG.

Prometic CEO Pierre Laurin said the move was a key one for the company.

“Regaining control of NantPro and its IVIG development program is representative of our transition towards becoming a vertically integrated specialty biopharmaceutical company,” he said. “As we step up our manufacturing and development activities, we anticipate advancing ourselves more of our high-value plasma-derived therapeutics.”

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Ridgeway says IVIG is a “highly valuable product” with low clinical and regulatory risk. He believes that Prometic will be able to sell as much IVIG as it can manufacture at its own facility and through its contract with Hematech. He believes that, at its peak, this would generate EBITDA of more than $95-million on a topline of less than $150-million. Under these new terms, he expains, Prometic’s share of the EBITDA stream would be worth more than $55-million.

In a research update to clients this morning, Ridgeway maintained his “Buy” rating on Prometic Life Sciences, but raised his one-year target on the stock from $2.25 to $2.80, implying a 172% return based on the price at publication date.

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