Diamond Equity Research Initiates Coverage on Oragenics Inc. (NYSE:OGEN) with a Valuation of $3.50 Per Share
NEW YORK, June 20, 2018 (GLOBE NEWSWIRE) -- via NetworkWire - Diamond Equity Research, a leading equity research firm with a focus on small capitalization public companies has initiated coverage of Oragenics Inc. (NYSE:OGEN). The in-depth 29-page initiation report includes detailed information on the Oragenics's business model, services, industry, valuation, management, and risks.
The full research report is available . Highlights from the report include:
Large Market Opportunity
Oragenics has positioned AG013 to treat over 2.2 million patients worldwide annually, enough to generate over $1.5 billion in sales and secure 20-25 percent market share if approved. AG013 is a peptide oral rinse developed to treat oral mucositis (OM), one of the most common and debilitating complications that arises during cancer therapy, which still lacks approved preventive treatments. The absence of effective drugs has resulted in a large potential market for any new treatments for OM. On May 30, 2018, Oragenics’ announced positive results of an interim safety analysis of AG013 in its ongoing study of an initial group of 20 patients enrolled in its 200-patient phase 2 clinical trial.
Oragenics is also developing OG716, a second-generation variant of MU1140, identified for its potential effectiveness in treating clostridium difficile infections (CDI), which affects 500,000 people a year in the U.S. alone; associated deaths have increased 400 percent in the past two decades. The CDI treatment market is growing rapidly, with U.S. sales projected at $426 million in 2019, according to GlobalData. Amid limited approved therapies, OG716 appears to be a means of preventing this life-threatening infection. Oragenics plans to file for an Investigational New Drug (IND) by the end of this year for OG716, assuming sufficient financing is available.
Numerous Upcoming Catalysts
Oragenics just announced positive results of an interim safety analysis of AG013 in its ongoing study of phase 2 clinical trial with the final trials set to be released in late 2019. We project the commercial sale of AG013 commencing in 2021 in the U.S. and a year later in Europe. The company’s strategic partnership with Intrexon will also continue providing exclusive access to major proprietary technologies to accelerate R&D and reduce funding costs, which should enhance shareholder value. The company also plans to file an IND for MU1140 in the fourth quarter of 2018.
Attractive Valuation
It is very difficult to value Oragenics Inc. given its early stage and the limited number of publicly listed companies engaged in the development of OM therapies. In our comparable company analysis, we screened for small capitalization companies within the biotechnology industry targeting similar indications and at similar stages of development. We estimated a forward-looking market value using the peer group average and median market value of each unique drug in their clinical trial stages. From our analysis, we have found the shares to be undervalued with significant upside from current trading levels. We also built a top down model and discounted cash flow to value Oragenics. Based on an average of the two methods, we computed a valuation of $3.50 per share, indicating substantial upside from the current price.
About Oragenics Inc.
Oragenics, Inc. is a biopharmaceutical company, which focuses on the development of novel antibiotics and treatments against infectious disease and oral mucositis. Its technology and pipeline are comprised of lantibiotics and genetically engineered bacterial strains. The company was founded by Jeffrey D. Hillman and Robert T. Zahradnik in November 1996 and is headquartered in Tampa, Florida.
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About Diamond Equity Research
Diamond Equity Research provides institutional quality research to emerging growth companies that are undercovered and undervalued. Diamond Equity Research is an approved sell-side provider on premiere institutional investor platforms including Factset, Morningstar, and Thomson One. The founder, Hunter Diamond, CFA, brings extensive experience working as a research analyst and investment banker focused on emerging growth companies. Hunter Diamond, CFA holds his Bachelor of Science and Master of Business Administration from Cornell University. The firm is headquartered in midtown Manhattan.
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Disclosures:
Full disclosures pertaining to this report can be found in the report at . Oragenics Inc. has paid for this report as company sponsored research, which is meant to subsidize the high cost of creating the report and monitoring the security, however the views in the report reflect that of Diamond Equity Research. Diamond Equity Research is being compensated by Oragenics Inc. for producing research materials regarding Oragenics Inc. and its securities. All payments are received upfront and are billed for an annual, semi-annual, or quarterly research engagement. As of 06/20/2018 the issuer had paid us $20,000 for our services, with services commencing on 04/27/2018. Additional fees may have accrued since then.
Contact:
Hunter Diamond, CFA
Diamond Equity Research, LLC
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