Analysts Weigh In On Zogenix In Light Of Selling Zohydro
TipRanks | Mar 12, 2015 09:37AM ET
Biopharmaceutical company Zogenix Inc (NASDAQ:ZGNX) announced on Tuesday that it will be selling its painkiller drug, Zohydro, to Pernix Therapeutics Holdings Inc (NASDAQ:PTX) for about $400 million.
The deal, scheduled to be closed in April, was made in an effort for Zogenix to cut costs and focus on two other drugs in its pipeline, brabafen, to treat Dravet syndrome, and relday, to fight schizophrenia.
There was a lot of controversy surrounding Zohydro following its launch on the market, as it belongs to the opioid class of drugs. Zogenix received negative attention from the drug as opioid abuse is a growing problem in the United States. As a result, the drug’s sales growth was too slow for the company to afford.
As a part of the deal, Zogenix will give Pernix the Zohydro franchise and transfer its sales team which will slash its employee count from 200 to 60.
Roger Hawley, chief executive officer of Zogenix said, “We are very pleased to have selected Pernix for this transaction as we believe they are well positioned to continue raising awareness of the important clinical benefits of Zohydro ER for patients suffering with severe chronic pain who are in need of around-the-clock opioid therapy... We thank our entire commercial and medical organizations for their achievements during the product's first year on the market and look forward to continued efforts in the coming months by our sales team in driving adoption of Zohydro ER in the pain community."
Zogenix also posted its fourth quarter financial report on March 10th, staying in line with analysts’ expectations. Highlights from the report include a loss of ($.013) a share and $14.9 million in revenue.
According to TipRanks is Strong Buy.
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