Supernus Pharmaceuticals (NASDAQ:SUPN)

CAPS Rating: 1 out of 5

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Player Avatar zzlangerhans (99.78) Submitted: 2/27/2013 1:10:38 AM : Outperform Start Price: $7.46 SUPN Score: -13.70

Supernus seems to have stabilized following a nasty below-market dilutive financing in November, so I'll extend a green thumb gingerly based on optimism for the Oxtellar XR launch. Extended release seems like a sufficient advantage to take significant market share from generic oxcarbazepine. After Oxtellar XR, however, the road appears much more rocky. Trokendi SR has been approved "conditionally", but it remains somewhat unclear exactly what the conditions are and when the company can expect full approval. Supernus reported positive data from the phase IIb trial of molindone in ADHD aggression but close examination of the data shows no effect at higher dose or in patients weighing less than 30 kg. Those inconsistencies will weigh on the likelihood of success in a phase III trial. Finally, the harsh CRL for United Therapeutics' oral trepostinil removes that potential source of royalty revenue for the foreseeable future.

Needless to say, it appears that Supernus' short-term performance is depending heavily on the Oxtellar XR launch. If the ramp falls short of expectations, look out below.

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