Veru Inc. (VERU) shares fell sharply lower Tuesday, but are still on pace for a five-day gain of more than 150%, following the drugmaker's plans to seek Emergency Use Authorization from the U.S. Food & Drug Administration for its newly-developed Covid treatment.
Miami-based Veru said data from a late-stage study showed its new oral treatment, known as sabizabulin, provided a 55% reduction in deaths, when compared to a placebo, in hospitalized patients suffering from moderate-to-severe forms of Covid -- irrespective of variant type. Sabizabulin was granted "fast track' designation by the FDA in January, a move that Veru said could "streamline" its EUA process.
"We strongly believe that sabizabulin, with its dual anti-viral and anti-inflammatory properties which demonstrated positive efficacy and safety results in the Phase 3 COVID-19 study, can be that greatly needed oral therapy for hospitalized moderate to severe COVID-19 patients," said CEO Mitchell Steiner.
Veru shares, which surged more than 182% yesterday, were marked 11% lower in early Tuesday trading to change hands at $10.94 each, a move that would value the group at just under $875 million.
Oppenheimer analyst Leland Gershell, who carries an 'outperform' rating with a $36 price target on the stock, said FDA approval would provide Veru with a "substantial near-term revenue opportunity".
Its demonstrated ability to improve outcomes in those at high risk of acute respiratory distress syndrome (ARDS) and death distinguishes sabizabulin from Mercks's (MRK) Lagevrio and Pfizer's (PFE) Paxlovid, indicated for milder disease and for which respective US government procurement contracts worth $2.2 billion and $5.3 billion have been awarded," he said.
"With the global pandemic showing little sign of abating and (The Biomedical Advanced Research and Development Authority) to be allocated $9.25 billion in additional COVID-19 funding, we believe sabizabulin will serve critical roles in the US and abroad," Gershell said.
