We called Correvio Pharmaceuticals early but there’s still upside, Mackie says

His calls on Correvio Pharmaceuticals (Correvio Pharmaceuticals Stock Quote, Chart, News NASDAQ:CORV) have generated a whopping return of 413 per cent since he launched coverage, but Mackie Research Capital André Uddin says there is lots of upside left.

This morning, CORV reported its Q3, 2019 results. The company lost (US) $10.78-million on revenue of $6.7-million, down slightly from the $7.0-million topline the company posted in the same period last year.

“On the commercial front, our marketed products portfolio has generated $21.3-million year to date in 2019, with $6.7-million of that occurring in the third quarter, and we remain on track for 2019 full-year revenues to deliver 20-per-cent growth over our 2018 full-year revenues,” CEO Mark H.N. Corrigan said. “As we look ahead to the remainder of 2019, we are actively preparing for the upcoming meeting of the U.S. Food and Drug Administration (FDA)’s cardiovascular and renal drugs advisory committee (CRDAC) to review the data supporting our new drug application (NDA) requesting approval for Brinavess which is scheduled for Dec. 10, 2019. We also look forward to presenting an additional analysis from Spectrum which looked specifically at patients treated in emergency departments at the upcoming American Heart Association (AHA) 2019 annual meeting in November.”

Uddin says third quarter revenue was lower than his estimate of $9.7-million due to a shift of $2.9-million in orders to the fourth quarter.

“The overall decrease in revenue was primarily attributable to the delay of $2.9 million of distributor orders which were expected to be shipped in September, but due to logistical constraints were not completed until early October. The delayed shipments will have a meaningfully positive impact on Correvio’s Q4 2019 financial results. As of Q3 end, CORV had $19.7M in cash and $44M in debt – the company should have a cash runway into mid-2020,” he said.

The analyst says there are three near-term catalysts for its antiarrhythmic drug Brinavess in the United States. First up, he notes, is a KOL dinner on November 18 featuring Dr. W. Douglas Weaver (the former President of the American College of Cardiology). Next, the FDA is to an advisory meeting on December 10 to discuss the Brinavess NDA. And lastly, the FDA has set a PDUFA date of Dec. 24th for the Brinavess NDA.

“We strongly believe Brinavess should be FDA approved,” the analyst asserted.

In a research update to clients today, Uddin maintained his “Speculative Buy” rating and one-year price target of $3.70 on Correvio Pharma, implying a return of 68 per cent at the time of publication.

The analyst thinks CORV will post a Fully Diluted EPS loss of $0.81 on revenue of $34.5-million in fiscal 2019. He expects that loss will narrow to $0.44 on a topline of $49.4-million the following year.

“We believe CORV’s share price in Q4 would be highly dictated by the potential FDA approval of Brinavess,” Uddin noted. “To our knowledge, CORV could be the only Canadian specialty pharma company (except Bausch Health) with a U.S. launch of a key product in the near term. Our CORV calls have generated a 413% return since we launched coverage.”