Analysts at Roth Capital have reiterated a Buy rating and $8 price target for shares in Seelos Therapeutics Inc (NASDAQ:SEEL) following the firm’s second quarter pipeline update, released on Thursday, noting that the “busy beavers continue to push forward with exciting updates to the SLS-005 program.”
In a note to clients, the Roth analysts said that after a busy first half of 2019, they see two catalysts that will give Seelos the opportunity to execute and build momentum in the third quarter – the first patient dosing in Ph2b/3 study of its SLS-005 drug in Sanfilippo Syndrome sufferers; and the initiation of PK/PD and DDI studies in suicidality for its SLS-002 drug.
They pointed out that anticipation is high for the SLS-005 program, which is centered around the use of trehalose, a natural, small molecule composed of two linked sugars that can cross the blood-brain barrier, to target the central nervous system and other diseases caused by formation of toxic protein aggregates.
The analysts estimate peak sales for SLS-005 in Sanfilippo Syndrome in the US to be $423.5 million based on estimates of 4,600 patients, with an 80% diagnosis rate, and assuming a 2022 launch in the US market, with an initial market penetration rate of 2% growing to 40% by 2028.
Seelos has also said it will further develop SLS-005 in other neurological indications such as oculopharyngeal muscular dystrophy (OPMD).
The Roth analysts said they forecast peak sales for SLS-005 in OPMD in the US to be $231.5 million, based on an estimated prevalence rate of 1:100,000, and assuming a 2022 launch in the US market, with an initial market penetration rate of 1% growing to 32% by 2028.
They also estimate peak sales for SLS-002 in acute suicidality in the US to be $1.68 billion based on the estimated 400,000 adults admitted to the hospital growing by 10% annually, and assuming a 2024 launch in the US market.
Seelos shares were trading at $1.52 in afternoon Nasdaq trade on Friday.