Soligenix initiated 'Market Outperform' at Rodman & Renshaw

Rodman & Renshaw initiated coverage of Soligenix Inc. (OTC: SNGX) with a Market Outperform rating and a $0.90 price target, saying shares of the late-stage biopharmaceutical company are poised to run higher on outlook for its orBec (oral beclomethasone) lead product.

orBec is currently being tested in a late-stage trial to treat acute gastrointestinal manifestation of graft-versus-host disease, which is an inflammatory condition that develops in most patients who receive an allogeneic, hematopoietic stem cell transplant (HSCT). The FDA has granted orBec an orphan designation, which carries seven years of marketing exclusivity.

Because HSCTs costs more than $200,000 in the first year alone and orBec is the only drug that extends survival in a condition with one of the highest rates of mortality, we expect orBec tol command a high price per 50 day course of treatment, the brokerage said.

Soligenix, formerly called DOR BioPharma, has entered into a 35 percent royalty-generating North American partnership deal with Sigma-Tau Pharmaceuticals.

With peak revenues over $100 million and an annual burn of roughly $6 million, the brokerage said Soligenix is poised to benefit from royalty revenues of $8 million in 2013and peaking at $35 million in 2019.

The brokerage said it sees a dramatic increase in Soligenix's earnings per share starting in 2012 that is driven by royalty revenues and no upfront marketing costs.

An additional catalyst is that orBec is unpartnered in Europe, where it will have ten years of marketing exclusivity, Rodman said.

Princeton, New Jersey-based Soligenix is also developing products to treat cancer and bioengineered vaccines designed to protect against the deadly effects of ricin toxin which is considered a serious bioterrorism threat.

Shares of Soligenix closed Wednesday's trading 13.33 percent higher at $0.170, with a market cap of $36.7 million.