Rahul Sarugaser of Raymond James has cemented HLS Therapeutics (HLS Therapeutics Stock Quote, Chart, News, Analysts, Financials TSX:HLS) as a Top Pick for 2022, maintaining his \u201cOutperform 2\u201d rating and target price of $26\/share for a projected return of 87.6 per cent in an update to his clients on December 15. Toronto-based specialty pharma company HLS Therapeutics focuses on acquiring and commercializing late-stage development, commercial-stage promoted and established pharmaceutical products for the North American market. Sarugaser says 2022 will be an inflection year for the company and he highlighted a pair of key building blocks for the company: a co-marketing deal with Pfizer to promote its Vascepa product and the expectation of it being eligible for public reimbursement in the first half of 2022.\u00a0 With the co-marketing agreement having been announced in August, Sarugaser noted the national launch as a material de-risking event for HLS\u2019s marketing execution. In conjunction with the initiative, company management noted its intent to have the Pfizer team quadruple HLS\u2019s sales reach by adding 66 more representatives, with Pfizer focusing on primary care physicians and HLS maintaining a focus on specialists. \u201cWith PFE\u2019s expertise in marketing and comarketing blockbuster cardiovascular drugs such as Lipitor and Eliquis, we view HLS\u2019s sales prospects for 2022 very favourably,\u201d Sarugaser said. Meanwhile, HLS management has been in active negotiations with every Canadian province in an effort to grant public reimbursement for Vascepa, remaining within the HLS indication of taking between 18 and 24 months to reach that point. Sarugaser notes that with Vascepa\u2019s status as a first-in-line cardiovascular drug, he anticipates more complex negotiations than usual and expects their conclusion to be reached nearer to the upper limit of management\u2019s time expectations. \u201cWhile HLS is seeking the establishment of national coverage of Vascepa, it is possible that stepwise coverage agreements could be announced with individual provinces,\u201d Sarugaser said. \u201cThat outcome\u2014though still second-best to one-shot national coverage \u2014would, in our view, imbue HLS\u2019s stock with positive, escalating momentum through 2022.\u201d In November, HLS reported third quarter financial revenue of $15.1 million and Adjusted EBITDA of $6.9 million, up 15 and 53 per cent, respectively, from the third quarter of 2020. "We continue to make important operational progress with Vascepa despite the impact of the COVID-19 delta variant, which has slowed market re-opening and kept in-person patient-physician interactions well below pre-pandemic norms,\u201d said Gilbert Godin, CEO of HLS in the company\u2019s November 4 press release. \u201cEncouragingly, the percentage of patient-physician visits that are taking place in-person is growing again and top health officials in Canada's largest provincial jurisdiction are publicly urging physicians to increase their face-to-face interactions. We believe this call-to-action will serve as a catalyst for Vascepa as a recent study found that physicians are 50 per cent more comfortable initiating new therapies in a face-to-face setting versus virtual communications," Godin said. Since Sarugaser\u2019s initial report was published, HLS has established an automatic share purchase plan in which HLS\u2019s common shares may be purchased under the NCIB at any time, including when HLS would ordinarily not be permitted to purchase Common Shares due to regulatory restrictions and customary self-imposed blackout restrictions. Sarugaser has slightly softened his stance on the company\u2019s financial projections in both the short and long term, with his 2021 revenue estimate now coming in at $61.3 million instead of $62 million for a year-over-year increase of 8.9 per cent, while also lowering his 2022 expectation from $122 million to $111.5 million, taking it from an effective doubling to a year-over-year jump of 81.9 per cent. From a valuation perspective, Sarugaser continues to see value in HLS as he projects the EV\/Revenue multiple to drop from the reported 9.3x in 2020 to a projected 8.5x in 2021, then falling again to a projected 4.7x in 2022. The EBITDA projections for the company have also slightly changed; while Sarugaser left his 2021 forecast of $27 million (margin of 44 per cent) unchanged, he has minimally lowered his 2022 projection from $58 million to $57 million, with the margin forecasted to increase to 51.2 per cent. Sarugaser\u2019s EV\/EBITDA multiple projections also show improvement, dropping from the reported 21.7x in 2020 to a projected 19.1x in 2021, then plummeting to a projected 9.3x in 2022. \u201cThe combination of public reimbursement for Vascepa\u2014HLS\u2019s blockbuster-in-waiting\u2014and PFE\u2019s sales engine impelling the drug\u2019s adoption we believe is a powerful one that will drive material, long-term momentum in HLS\u2019s stock,\u201d Sarugaser said. As with many names in the health care space, HLS has experienced a bit of hurt in its stock price in 2021, dropping by 10.7 per cent over the course of the year and currently trading around $15.00.