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Sorrento Hasn’t Moved Much of Late Despite Having a COVID-19 Play

Sorrento (SRNE) has a multi-pronged approach to therapeutics. The company has been constantly adding new options to its bulging pipeline and has made two notable additions over the past month.

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This article was originally published by TipRanks.

Sorrento (SRNE) has a multi-pronged approach to therapeutics. The company has been constantly adding new options to its bulging pipeline and has made two notable additions over the past month.

Earlier this week, Sorrento and majority-owned subsidiary Scilex disclosed they are signing an exclusive licensing deal with Aardvark Therapeutics, which will bring ARD-301 under the ever-expanding Sorrento umbrella.

ARD-301, Aardvark’s proprietary LDN (Low Dose Naltrexone) formulation is intended to treat chronic pain, fibromyalgia, and chronic post-COVID syndrome (“long COVID”) and will augment the company’s non-opioid pain franchise.

Scilex plans to kick off a new Phase 2 trial this year for both fibromyalgia and chronic post-COVID syndrome.

In previous clinical studies with LDN, the non-opioid, non-addictive therapeutic has displayed activity that has improved a wide array of fibromyalgia symptoms. Right now, for the disorder, there are just 3 FDA approved treatments.

“With ARD-301, Scilex is adding a key tool to physicians’ therapeutic armamentarium for treating fibromyalgia, a chronic disorder characterized by musculoskeletal pain that affects ~10M U.S. adults,” said B. Riley analyst Mayank Mamtani. "ARD-301 also serves as a bridge to SRNE's two of three core therapeutic areas (TAs) in non-opioid pain and C-19.”

The latest move follows last month’s announcement of another addition; Sorrento is purchasing the outstanding equity of ANP Technologies for a total of $100 million.

The acquisition will not only give Sorrento access to a “diverse pipeline” based on ANP’s Nano Intelligent Detection/Delivery System (NIDS®) for the identification of chemical and bio-warfare agents, but adds a second EUA-stage Covid-19 diagnostic to its arsenal.

Mamtani says the acquisition will bring in “extra capacity to produce COVID test kits and provide the know-how to optimize the assay through improving detection capabilities, thereby conferring increased sensitivity and specificity.”

All in all, Mamtani keeps a Buy rating on SRNE shares, alongside a $26 price target. The implication for investors? Upside of a hefty 192%. (To watch Mamtani’s track record, click here)

Big gains are also anticipated by Mamtani’s colleagues. The even higher $28 average price target implies the stock will be changing hands for a 209% premium a year for now. All 4 analysts keeping a tab on Sorrento rate it a Buy, resulting in a Strong Buy consensus rating. (See SRNE stock analysis on TipRanks)

To find good ideas for coronavirus stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

The post Sorrento Stock Is a Buy Because of Its Strong Drug Pipeline, Says Analyst appeared first on TipRanks Financial Blog.

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