The recent healing of a patient in the United States with ProMetic Life Sciences’ (TSXV:PLI) plasminogen adds to the evidence supporting the treatment as it seeks market approval, says Paradigm Capital analyst Christopher Lam.
This morning, ProMetic announced it had successfully treated another plasminogen-deficient patient in the United States under a compassionate use investigational new drug. Compassionate use is a term that refers to the use of a non-approved drug when no other effective treatment options are available.
The company says the patient had fourth month-old open surgical wounds that were rapidly healed with its plasminogen wound-healing program.
“We observed a progressive and systematic healing of all the wounds on the patient’s hand over a period of two weeks from his first plasminogen infusion. Within three hours after that first infusion, we saw minor bleeding from the wounds, which stopped spontaneously — the first sign of plasminogen’s effectiveness. This was followed by the formation of scabs on the wounds which started to fall off after 12 days, just as in the normal healing process,” said ProMetic’s chief medical officer, Dr. John Moran. “We are all very impressed with the speed of healing of this patient’s wounds. What is even more remarkable is that the patient has reported a significant increase in the range of motion of his middle finger, which was contracted due to the infection. In fact, from needing to write using only his thumb and index finger, he can now bend his middle finger enough to write as normal,” added Dr. Moran.
Lam says this result is relevant to the FDA because it supports the rationale for the health economics of plasminogen. But the analyst says one situation in particular is putting something of ceiling on shareholders getting the full upside benefit from the drug’s anticipated rollout.
“Our valuation model for plasminogen is limited by ProMetic’s estimated production capacity from its Laval and Winnipeg facilities,” he says. “We expect PLI’s Canadian facilities to be able to produce only 7.5% of the total estimated plasminogen market demand. As such, we believe there is upside potential to our valuation should PLI increase production capacity or access capacity from its overseas licensed partners in Russia and China.
In a research update to clients today, Lam maintained his “Buy” recommendation and one-year price target of $5.50 on ProMetic Life Sciences, implying a return of 64 per cent at the time of publication (including dividend).