Zogenix, Inc. (NASDAQ:ZGNX)

CAPS Rating: 3 out of 5

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Member Avatar pchop12316 (75.74) Submitted: 11/22/2014 1:18:48 PM : Outperform Start Price: $1.19 ZGNX Score: +4.43

underpriced dramatically for its current value

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Member Avatar zzlangerhans (99.85) Submitted: 11/21/2014 3:25:40 PM : Outperform Start Price: $1.19 ZGNX Score: +4.03

I'm extending a very cautious outperform on Zogenix, a company I've trashed enthusiastically in the past. I still believe that their acetaminophen-free long acting hydrocodone Zohydro is doomed to failure, but the share price seems to have stabilized with a couple of catalysts ahead.

Zogenix has submitted an sNDA for a modified formulation of Zohydro with "potential" abuse-deterrent properties (quotation marks mine) and expects an FDA decision by late January. I emphasize the word potential because I think Zogenix is using it to protect themselves from the possibility that the FDA won't give them abuse-deterrent labeling, much as they withheld from Acura's Oxecta. Potentially abuse-deterrent and labeled abuse-deterrent might seem like a subtle distinction to traders, but when it comes to prescriptions from pain management doctors it will make a big difference.

Zogenix's second catalyst is the initiation of a phase III trial of newly-acquired anti-epileptic brabafen (low-dose fenfluramine) for seizures of Dravet's syndrome, expected in Q2 2015. Brabafen isn't just for show - Zohydro paid 35M upfront in cash and stock as well as substantial commitments in milestones and future royalties when they bought developer Brabant in October. Nevertheless, I briefly looked into the drug and had some questions. Zogenix claims that Dravet's seizures don't respond to standard anti-epileptic medications. It's true that commonly-used anticonvulsants like phenytoin and tegretol don't help and may actually worsen the seizures, but other cheap generics like valproate and topiramate are considered to be the standard of care. They don't control the seizures completely, but that's a far cry from a disease with no treatment. Meanwhile, the best evidence for brabafen comes from an open label study of 15 patients that has been going on for 26 years. 26 years? And no one thought it was worth initiating a registrational trial during that time? Zogenix says that topline results of two phase III trials of brabafen will have topline results potentially available in the first half of 2016. There's that word again. I'd be very interested to see the design and primary endpoints of those trials, especially regarding the active comparator. And let us not forget that fenfluramine was taken off the market in the 1990's when it was a weight loss drug due to cardiac valve damage. The open label study reports minimal effects of low dose fenfluramine on heart valves, but will one year of exposure be sufficient to convince the FDA that the drug is safe.

As I said, this is a very cautious outperform and not a trade-grade situation as of yet. I do expect the stock to move upward ahead of the next PDUFA but I'm not yet convinced it has finished going down. In addition, much will depend on how heavily brabafen gets hyped. Low-float, low-priced microcap biopharmas like Zogenix are easily manipulated and retail traders can get hammered in the short term no matter which direction they choose to play.

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Member Avatar byonts (< 20) Submitted: 4/23/2014 12:32:05 PM : Outperform Start Price: $2.86 ZGNX Score: -67.33

outperform; it has an extended release drug, approved for sale, to replace the fda discontinued meds for chronic pain. This is a 61B industry.

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Member Avatar YODSTER (76.39) Submitted: 4/1/2014 12:08:47 AM : Outperform Start Price: $2.87 ZGNX Score: -67.54

This drug is getting bashed and beaten down for nothing. The drug is simply vicodin without acetaminophen. Not a new scary heroin. My gosh, no drug is tamper resistant yet. Google how to shoot up oxycontin and the 3rd result tells you how to get the tamper resistance off. The FDA Mandated to the pharma industry to make pain drugs that won't hurt the liver for chronic pain sufferers. This is that drug.

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Member Avatar arshak999 (68.45) Submitted: 3/27/2014 8:08:36 AM : Outperform Start Price: $2.92 ZGNX Score: -70.00

Only pain management drug of its kind currently approved by the FDA. The drug doesn't damage the liver like all of its commentators. Down recently because commentator's CEO's father is a senator who introduced a bill to remove the drug over concerns for its possibly being abused. The bill has no chance of passing and the drug is going to head up sharply.

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Member Avatar optionsmaster (52.00) Submitted: 12/20/2013 10:43:02 AM : Outperform Start Price: $3.08 ZGNX Score: -74.25

New product launches and it's an obvious buy out target

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Member Avatar bluesteel22 (< 20) Submitted: 12/17/2013 4:44:29 PM : Outperform Start Price: $2.99 ZGNX Score: -74.69

Sales of Zohydro in March 2014

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Member Avatar jungleboi313 (< 20) Submitted: 3/10/2013 3:03:32 PM : Outperform Start Price: $1.75 ZGNX Score: -62.77

drug approval chances are very high. full 2012 financial results to be announced Fri, 15th. Even if dont approved, price wont go down dramatically.

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Member Avatar Vapor09 (49.76) Submitted: 3/3/2013 1:16:39 AM : Outperform Start Price: $1.88 ZGNX Score: -70.86

Pain killer approval

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Member Avatar TMFMattyA (99.72) Submitted: 12/10/2012 2:50:01 PM : Underperform Start Price: $1.20 ZGNX Score: +42.17

I was once a small proponent of this company, but the recent FDA decision seriously hinders Zogenix's market-beating potential, at least for the next year or so.

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Member Avatar RBuskey106 (45.63) Submitted: 4/4/2012 12:56:04 PM : Outperform Start Price: $2.02 ZGNX Score: -87.37

Chart Play

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Member Avatar anzuwin (58.36) Submitted: 10/4/2011 12:18:23 PM : Outperform Start Price: $1.81 ZGNX Score: -120.05

Great deal of insider buying. Good amount of institutional buying. Positive analyst ratings and price targets. They should be done with their public offerings, only up from here.

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