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Acer Therapeutics Inc.: Initiation of Research Coverage

Friday, February 16, 2018

William Blair & Company initiated research coverage of Acer Therapeutics Inc. (ACER $17.00), a biopharmaceutical company focused on the development of treatments for rare diseases.

Analyst Tim Lugo estimated Acer holds peak-year sales potential of $500 million for its first two assets: lead asset Edsivo for the treatment of vEDS, a rare hereditary condition of the vascular connective tissue that leads to increased risk of vascular rupture and death, and ACER-001, a taste-masked, immediate-release formulation of sodium phenylbutyrate for the treatment of urea cycle disorders (UCDs) and maple syrup urine disease (MSUD).

"While Edsivo is used as a therapy for vEDS in Europe, it is not yet available to patients in the United States," Lugo said. "Acer intends to bring the product to the United States with a potential NDA filing in mid-2018. If the company receives a priority review, we expect a launch of Edsivo for vEDS in early 2019. Given orphan pricing, we expect the total vEDS market to approximate $400 million in peak-year sales, while Edsivo may also show potential in additional indications, including Marfan and Loeys-Dietz syndromes. For ACER-001, Acer will use the 505b(2) filing pathway and expects to be able to launch the product for the treatment of UCDs in 2020. We also see potential for the product in the treatment of the ultra-rare MSUD, although a launch in this indication would not be until 2021."

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Coverage Universe
Outperform (Buy): 64%
Market Perform (Hold): 34%
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Market Perform (Hold): 7%
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