A Quick Look At Recro Pharma

Recro Pharma, Inc. (REPH) develops non-opiod drugs for pain management. REPH is targeting an NDA this year for its fast-acting IV version of Meloxicam, a well-known NSAID whose oral version just takes too long to work, but has been shown to be effective. REPH is even developing an intramuscular delivery format for this drug, which is in early stages but makes the pipeline robust. It is also developing an IV version of Dexmedetomidine but with a lower dose concentration because of its sedative effects, as well as of Fadolmidine, a similar compound but with no sedative effect. Besides its pipeline, REPH also has a side manufacturing business which currently runs at a small loss but will probably turn profitable once debt is serviced and revenue picks up. There is some confusing discrepancy in market cap and cash position data on Google Finance and SA/YF, etc, but overall, after its latest offering, the company is probably in no urgent need for cash. REPH needs to pay a total of $45mn milestone to Alkermes upon NDA approval, $10mn ($15mn if deferred) is due upon approval.

As to the science, a fast-acting non-opioid drug product is the need of the hour, and the market for its 3 product candidates is in the billions of dollars. Its IV version of Meloxicam, N1539, did very well in the phase 3, meeting its primary endpoint with a significantly small p-value and meeting 10 other secondary endpoints. There were few AEs, and as every involved physician knows, a non-opioid, non-addictive pain reliever is a big deal in today’s medicine. Complete study results here.

In my opinion, purely from a scientific viewpoint, this one looks like an interesting stock, although I would worry a little about their cash position, or lack of it. I could not come to a definite conclusion because of the differences in data. But if they have anything less than $50-60mn in cash right now, how are they planning to market their drug in 2018?

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Author: Travis Esquivel

Travis Esquivel is an engineer, passionate soccer player and full-time dad. He enjoys writing about innovation and technology from time to time.

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