Shares of VistaGen Therapeutics Inc (NASDAQ:VTGN) rocketed Friday after Oppenheimer initiated coverage of the San Francisco biotech developing new generation medicines for depression with an Outperform rating.
VistaGen Therapeutics shares streaked nearly 60% higher to US$1.55.
Analysts at Oppenheimer viewed VistaGen as “underappreciated and undervalued,” with a novel, “potentially best-in-class, rapid acting” oral antidepressant.
Two catalysts ahead
“We believe VistaGen’s unique antidepressant (AV-101) may offer ketamine-like efficacy without the side effects or inconvenience. VistaGen currently has a pair of Phase 2 trials running to demonstrate the efficacy and safety of AV-101 in patients with depression and an inadequate response to at least one prior treatment,” wrote Oppenheimer analysts Jay Olson and Silvan Tuerkcan in a note to clients.
The analysts issued a US$6 price target ahead of what it expects to be several positive data readouts.
Data from the first, smaller trial, with 25 participants, is expected to come in by the end of 2018. The second, larger trial with 180 subjects isn’t expected to throw up results until mid-2019.
“We believe these trial readouts are important catalysts that could unlock substantial shareholder value,” wrote the analysts.
The Oppenheimer note indicated that if the Phase 2 trials are successful, VistaGen could begin pivotal trials by early-2020, with potential NDA filing in 2022. The antidepressant would then be expected to launch in 2023.
“We expect a 2023 US launch of AV-101 for depressed patients with inadequate response to current antidepressants,” wrote the analysts.