Correvio Pharma has major catalysts on the horizon, Mackie says

Mackie Research analyst André Uddin is sticking to his guns when it comes to specialty pharmaceutical company Correvio Pharma (Correvio Pharma Stock Quote, Chart TSX:CORV), which he says has major catalysts still to come in 2019.

Vancouver’s Correvio (formerly Cardiome Pharma) reported its first quarter ended March 31, 2019, financials on Wednesday, with total revenues of $7.3 million in comparison to $6.5 million a year ago. Its net loss was $9.0 million or $0.23 per share.

Of the Q1, CEO Mark H.N. Corrigan said, “Our first quarter revenues from Xydalba and Zevtera doubled year-over-year. Looking ahead, we remain on track to resubmit the New Drug Application seeking approval in the US for Brinavess as a new treatment for adult patients with recent onset atrial fibrillation during the second quarter of 2019.”

In an update to clients Wednesday, Uddin says CORV’s quarterly revenue was lower than his $7.5-million estimate as well as the consensus forecast of $8.0 million, while the net loss was also weaker than his $7.7-million or $0.20 per share estimate and the Street’s negative $8.3 million or negative $0.21 per share.

At the same time, Uddin pointed to the company’s progress in growing its top line, particularly through its direct sales segment, where a marketing application in Europe for Treveyent is expected in the second half of 2019.

But the major fireworks are yet to come, says Uddin, who notes Correvio’s resubmission of its NDA for Brinavess during this Q2, one that is likely to be approved, says the analyst.

“With extensive solid clinical and real-world data generated to date, we are confident the FDA would approve Brinavess for treating atrial fibrillation – potentially as early as Q4 2019. CORV has not announced its US commercial plan for this product yet. We have assumed CORV would forge a licensing deal in 2020 (although it could easily occur in 2019) for US$50 million upfront plus US$100 million in sales milestones as well as a royalty rate to scale from 20 per cent to 25 per cent. We have also assumed in our model that Brinavess would be launched in the U.S. in 2020. We conservatively estimate Brinavess could be a US$200-million product in the US,” says Uddin.

The analyst says that with very significant catalysts ahead, CORV “could finally pull out of its trading range.” Uddin has reiterated his “Speculative Buy” rating and $5.75 target, which represented a projected return of 104 per cent at the time of publication.