Recent Sell-off for Adamis (ADMP) Overdone!
Focus on new product pipeline for an outstanding “Buying Opportunity.” As I mentioned in a recent readership alert…and it bears repeating… Adamis Pharmaceuticals is a San Diego-based specialty pharma company that is the “real deal.”
Here’s why I think you should consider adding ADMP to your small-cap portfolio today:
Adamis has approximately $6-$7 million in the bank and no long-term debt. The Company looks to have enough cash to fund its first submission to the FDA (an epinephrine pre-filled syringe) and its clinical trial plans for 2014.
Adamis – a Short-term revenue potential
Following early ’15 approval, which appears very likely, Adamis could be into production and distribution by mid-year… therefore, there is short-term revenue potential and a possible $30 – $50 million business over the next 2-3 years by supplying institutional customers with a “no frills” epinephrine pre-filled syringe priced at roughly 50% of existing auto-injectors’ wholesale acquisition costs (WACs).
Adamis also is focused on the near-term development of two additional products for the treatment of allergies and respiratory diseases utilizing the 505(b)2 regulatory pathway which could cut down on development costs and shorten the time to market. Each one could eventually add another $30 million or more to annual revenues, but it will take several years to reach this point.
Long-term “Blockbuster” revenue potential
Adamis secured the exclusive rights to a potentially market-disruptive technology from 3M (MMM – NYSE). 3M’s Taper Dry Powder Inhaler (DPI) is a very efficient drug delivery device that, if approved by the FDA, could compete directly with the Advair Diskus, owned and marketed by Glaxo-SmithKline (GSK – NYSE). Advair is the industry standard treatment for severe asthma and late-stage COPD with nearly 90% global market share and ~$7.7 billion in 2012 revenues.
Adamis plans to initially market its APC-5000 product (utilizing the Taper DPI device) as a branded generic drug option in the US, once it has FDA approval. As was further reported in a recent research report from Harbinger Research, Brian Connell, CFA…
“Given the FDA’s 2013 guidance for Advair generics and the fact that Adamis’ planned offering uses the same drug mix contained in the Advair Diskus, we believe FDA approval is a probability by 2017. Given the size of this market and the efficiency of the Taper DPI, gaining even a small percentage of this market would be a huge win for Adamis.
$250 million in sales and a takeover candidate
“We believe that the 3M device has the potential to eventually generate $250 million or more in global sales; if this is correct, it will eventually make Adamis a “Big Pharma” takeover candidate, which is clearly not reflected in Adamis’ current market valuation.”
- Excellent Management Team – results driven and deeply experienced; focused on revenue development and shareholder value
- Well Financed – no long-term debt; sufficient cash in the bank to execute their product intro strategy
- NASDAQ Listed – increased visibility for institutional & individual investors; high level of regulatory over-sight on senior exchange
- Multi-product Pipeline – first product to market (Epinephrine Pre-filled Syringe) targeted for first half of CY2015; two additional products will likely receive FDA approval in 2016 and 2017 – eventual annual revenues of $30 million or more expected for each.
- Blockbuster Revenue Potential for recently acquired 3M Dry Powder Inhaler (DPI) technology – creating potential branded generic competitor for Glaxo-SmithKline (NYSE: GSK) and its $7.7 billion global market.
- Large Market Potential – asthma and late-stage COPD global market: ~$8 billion; $4 billion domestic. $1 billion US market for epinephrine with 10% annual growth. $2.7 billion US market for mild COPD and Asthma treatments
Here’s the Bottom Line… if you’re in the market for an under-valued, high growth specialty pharma company to add to your small-cap portfolio, Adamis Pharmaceuticals (ADMP) is the real deal and is the one you’ll want to own… NOW.
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P.S. We believe ADMP shares are extremely undervalued at this time… potential upside of 257% to 309%.*
For additional information about Adamis Pharmaceuticals please visit their website: http://www.adamispharmaceuticals.com/
To read the full Harbinger Research report, visit: http://microcapmarketplace.com/docs/ADMP_Research_Report.pdf
*Based on closing price 4/10/2014 and $15 – $18 price target.
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