Oppenheimer Initiates Buy Rating on Rockwell Medical Inc (NASDAQ:RMTI)

Equity Analyst Ling Wang, CFA of Investment Research Firm Oppenheimer issued a research report and ”outperform” rating on Rockwell Medical Inc (NASDAQ:RMTI) titled ”Management Update—Buying On Weakness/Reiterate Outperform & $26 PT” on September 28 with a $26 12 to 18 month price target.

Ling Wang, CFA stated ”RMTI shares have declined significantly (down ~25% YTD) along with the highly volatile biotechnology market. With the stock trading even below the level prior to Triferic approval, we view the weakness as a good buying opportunity since we believe the fundamentals of the company remain intact. We expect a fast ramp-up of Triferic (officially launched in the US only about two week ago), a potential launch of Calcitriol in 2H15, a fast path to profitability and potential business development activities to drive the shares in the near term. Our recent discussion with management indicated that client interest for Triferic is high, and the company is actively engaging in various stages of discussions with all major dialysis providers for the marketing of Triferic.

Rockwell Medical Inc (NASDAQ:RMTI) bills itself as a fully-integrated biopharmaceutical company targeting end-stage renal disease (ESRD) and chronic kidney disease (CKD) with innovative products and services for the treatment of iron replacement, secondary hyperparathyroidism and hemodialysis.

Rockwell’s recent FDA approved drug Triferic is indicated for iron replacement and maintenance of hemoglobin in hemodialysis patients. Triferic delivers iron to patients during their regular dialysis treatment, using dialysate as the delivery mechanism. In completed clinical trials, Triferic has demonstrated that it safely and effectively delivers sufficient iron to the bone marrow and maintains hemoglobin, without increasing iron stores (ferritin). Rockwell intends to market Triferic to hemodialysis patients in the U.S. dialysis market.

Key Points of the report include ”Share weakness overdone. With the recent weakness, RMTI shares are trading below the levels prior to Triferic approval earlier this year. Now with Triferic officially launched in the US, significant operating leverage, and no competition in theforeseeable future, we continue to see a clear path for RMTI to reach profitability in the near term.

Triferic is early in the launch, but client interest is high. The company is actively communicating with both the corporate and clinical sides of potential clients, with discussions ongoing at various stages with all major dialysis providers. We continue to expect large providers to test Triferic in certain pilotcenters while smaller/independent dialysis centers/hospitals may order Triferic directly.

On September 9 RMTI announced the nationwide commercial availability of Triferic (ferric pyrophosphate citrate). Triferic is the only FDA approved iron product indicated to replace iron and maintain hemoglobin in hemodialysis patients in the United States.

Dr. Steven Fishbane, lead author and Chief, Division of Kidney Diseases and Hypertension, North Shore University Hospital and Long Island Jewish Medical Center, stated, “I’m very excited to be able to provide Triferic to my patients. Having iron delivered at every dialysis treatment that immediately binds to transferrin and that does not induce iron overload is very similar to the slower, natural process in which iron is used in the body to maintain hemoglobin. We have seen the positive benefits Triferic has had on our patients during the clinical studies and now we are excited to have the drug available to treat patients beyond the research setting. Treating patients with a repletion therapy like IV iron has been associated with a variety of risks. Triferic, in contrast, is a true iron maintenance therapy with an exceptional safety profile and is an important new option for treating patients on chronic hemodialysis.”


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