We just covered the Billionaire Joe Edelman’s 10 Stock Picks with Huge Upside Potential and Protagonist Therapeutics, Inc. (NASDAQ:PTGX) ranks 10th on this list.
Elite investors have been positioning themselves in Protagonist Therapeutics, Inc. (NASDAQ:PTGX) stock as the firm transforms from a clinical-stage biotech to a high-margin commercial royalty engine. An important reason for interest in the shares this year has been the FDA approval of Icotyde for moderate-to-severe plaque psoriasis. Icotyde is the only once-daily oral IL-23R peptide on the market. Wall Street views it as a disruptive alternative to existing injectables, offering the convenience of a pill with the potency of a biologic. The drug was developed in collaboration with Johnson & Johnson, which holds exclusive commercialization rights. This partnership de-risks the launch for Protagonist, as J&J’s massive marketing machine will drive adoption while Protagonist collects high-margin royalties.
Protagonist Therapeutics, Inc. (NASDAQ:PTGX) is rapidly improving the balance sheet following the commercial pivot. The FDA approval triggered an immediate $50 million milestone payment from J&J. The company remains eligible for up to $580 million in additional regulatory and sales milestones, plus tiered royalties, 6% to 10%, on global net sales. Hedge funds view this as a guaranteed, low-risk cash flow stream that could fund the rest of the company’s pipeline for years. These funds are also pricing in the success of Rusfertide, the company’s lead candidate for a rare blood disorder. In March, Protagonist submitted its New Drug Application for Rusfertide, backed by successful 52-week Phase 3 data.
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