Saturday, January 20, 2018

An Integrated BioSci Alpha-Intelligence On Ocular Therapeutix: All Eyes On The Investing And Acquisition Prospects Of A Stellar Innovator


  • Recent acquisition Kite by Gilead (and the likely buyout of Juno by Celgene) foretell a highly favorable M&A environment for 2018.
  • Innovating a highly enriched pipeline, Ocular’s trading reversal is powering a pending catalyst.
  • Regeneron already partnered with Ocular for the development of the sustain-release version of its blockbuster drug (Eylea).
  • With its existing partnership with Regeneron, Ocular is the prime M&A candidate by the aforesaid giant.
  • The temporary share price recession of Ocular (coupled with its robust fundamentals) created an opportunistic entry point with significant upsides.

“Companies which have significant growth prospects for the next few years because of new demand for existing lines, but which have neither policies nor plans to provide for further developments beyond this may provide a vehicle for a nice one-time profit. They are not apt to provide the surest route to financial success. It is at this point that scientific research and development engineering begin to enter the picture. It is largely through these means that companies improve old products and develop new ones. This is the usual route by which a management not content with one isolated spurt of growth sees that growth occurs in a series of more or less continuous spurts.” - The Father of Growth Investing (Philip Fisher).

In the past 52-week, the shares of Ocular Therapeutix (NASDAQ:OCUL) traded $1.86 lower at $6.23 (for the potential loss of 22%). The share price recession was due to the complete response letter (“CRL”) that the Bedford, MA-based firm received from the FDA re the late-stage molecule dexamethasone insert 0.4mg (Dextenza) - a potential medicine to manage ocular pain, following eyes surgery. In the middle of this difficulty is the opportunity to invest in a bioscience with highly promising prospects as well as being a potential acquisition candidate by Regeneron Pharmaceuticals (NASDAQ:REGN).

Figure 1: Ocular Therapeutix stock chart. (Source: StockCharts).

Aside from our 2017 best performer, Nektar Therapeutics (NASDAQ:NKTR) that delivered over 280% for subscribers of Integrated BioSci Investing (“IBI”), we also published a few M&A candidates over the years. Our superb CAR-T innovator, Kite Pharma (NASDAQ:KITE) was consummated by Gilead Sciences (NASDAQ:GILD) while another CAR-T developer in the IBI Long-Term portfolio is in the discussions to be acquired by Celgene Corporation (NASDAQ:CELG). In this report, we’ll elucidate the investing thesis on Ocular while touching upon its aforesaid buyout prospects.
Fundamentals Analysis

The ophthalmology-focused bioscience, Ocular Therapeutix has one approved product, ReSure. As the first of its kind for sealing the clear corneal incision following cataract surgery, ReSure is prepared and applied promptly after surgery to protect the incision (in the immediate postoperative period) when the wound is most vulnerable. Notably, there is no need for ReSure removal (because the hydrogel gradually sloughs off in the tears during the healing process coined reepithelialization).

Similar to ReSure, other molecules in the pipeline utilize the hydrogel technology that is biodegradable while allowing for the extended delivery of various drugs (as shown in figure 2). Accordingly, there are three late-stage therapeutics, including two dexamethasone insert (Dextenza and OTX-DP), and travoprost insert (OTX-TP) indicated as the potential treatments of post-surgical pain and management, allergic conjunctivitis, and ocular hypertension relating to glaucoma, respectively.

Figure 2: Therapeutic pipeline. (Source: Ocular Therapeutix).

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Author’s Notes: We’re honored that you took the time out of your busy day to read our market intelligence. Founded by Dr. Hung Tran, MD, MS, CNPR, (in collaborations with Dr. Tran BioSci analyst, Ngoc Vu, and other PhDs), Integrated BioSci Investing (“IBI”) marketplace research is delivering stellar returns since inceptions. To name a few, Nektar Therapeutics (NASDAQ:NKTR) procured more than 280% profits; Spectrum Pharmaceuticals (NASDAQ:SPPI) delivered over 150% gains; Kite Pharma netted 82%. Exelixis Inc (NASDAQ:EXEL) earned greater than 50% capital appreciation. Our secret sauce is extreme due diligence coupled with expert data analysis. The service features a once-weekly exclusive in-depth Integrated BioSci Alpha-Intelligence article (in the form of research, reports, or interviews), daily individual stocks consulting, and model portfolios.

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