Aerie (AERI) Receives FDA Nod For Rocklatan To Treat Glaucoma

Aerie Pharmaceuticals, Inc. ( (NASDAQ:AERI) announced that the FDA has approved Rocklatan 0.02%/0.005% to reduce elevated intraocular pressure (IOP) in patients with open-angle glaucoma or ocular hypertension. Rocklatan is a once-daily, quadruple-action fixed-dose combination of Rhopressa (netarsudil) and Pfizer’s (NYSE:PFE) Xalatan (latanoprost).

The FDA approval was supported by data from two phase III registration studies, MERCURY 1 and MERCURY 2. In these studies, Rocklatan achieved its primary 90-day efficacy endpoint, and positive 12-month safety and efficacy results, demonstrating statistically superior IOP reduction over latanoprost and netarsudil at every measured time point. Aerie’s new drug application (NDA) for Rocklatan 0.02%/0.005% was submitted to the FDA in May 2018.

This is the second FDA approval that the company has received for the treatment of glaucoma within a year of the U.S. launch of Rhopressa. The company plans to launch Rocklatan in the United States in the second quarter of 2019.

Share price of the company decreased 21% in the past year compared with the industry’s decline of 16.6%.

Along with the approval, the company also announced full-year 2019 net revenue and net cash burn guidance. The company expects revenue for 2019 to be $110-$120 million. This guidance includes the combined net revenues of Rhopressa (netarsudil ophthalmic solution) 0.02% and Rocklatan.

As Rocklatan has just received approval, a large portion of the company’s net revenue guidance is expected to be achieved later this year. The company expects to gain meaningful Rocklatan market access for commercial and Medicare Part D plans as the year progresses.

Net cash burn for full-year 2019 is expected to be $130-$140 million. Including the $100-million undrawn credit facility available to the company, total liquidity at the end of 2019 is forecast to be $160-$170 million based on the net cash burn guidance range.

Zacks Rank and Other Key Picks

Aerie currently carries a Zacks Rank #2 (Buy).

Some top-ranked stocks from the same space are Celgene Corporation (NASDAQ:CELG) and BioDelivery Sciences International, Inc. (NASDAQ:BDSI) . While Celgene carries a Zacks Rank #1 (Strong Buy), BioDelivery carries a Zacks Rank#2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Celgene’s earnings per share estimates have increased from $10.34 to $10.73 for 2019 and from $12.28 to $12.76 for 2020 in the past 60 days. The company delivered a positive earnings surprise in all the trailing four quarters, with average of 2.65%.

BioDelivery Sciences’ loss per share estimates have narrowed from 25 cents to 20 cents for 2019 over the past 60 days. The company delivered a positive earnings surprise in three of the trailing four quarters, with average of 8.57%.

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