The Verdict On Aerie Pharmaceuticals


  • We revisit Aerie Pharmaceuticals. The stock has had a wild ride, getting crushed in the back half of 2018 and rising nicely so far in 2019.
  • The company is just rolling out its first approved product and has another PDUFA date with the FDA coming up in mid-March.
  • We take a deeper look at this ocular concern in the paragraphs below.

“He has all the virtues I dislike and none of the vices I admire.” -Winston S. Churchill, Wealth, War, and Wisdom

It has been quite a while since we looked at Aerie Pharmaceuticals (NASDAQ:AERI). The stock, like most small biotech stocks, was crushed in the back half of 2018. However, the shares have acquitted themselves well so far in 2019. I have gotten a few questions from around this name recently. With a key PDUFA date in mid-March, it is time to revisit this ocular concern.

Company Overview:

Aerie Pharmaceuticals is a North Carolina based ophthalmic pharmaceutical company, focuses on the development and commercialization of first-in-class therapies for the treatment of glaucoma and other eye diseases. The stock came public late in 2013 and sports a market capitalization just north of $2 billion. It stock currently trades for just over $45 a share after a nice rally in January.

Product Portfolio & Pipeline:

Global Pipeline

Source: Company Website

Rhopressa was approved to treat glaucoma late in 2017 and rolled out in the first half of 2018. Rhopressa is a once daily treatment that lowers eye pressure in patients with open-angle glaucoma and ocular hypertension. In the third quarter, the compound did $7.2 million in revenues. The company expects Rhopressa will generate between $20 million to $30 million in sales in FY2018.

Aerie’s next potential approval is for Roclatan, which has a March 14th PDUFA date. Roclatan is a once-daily eye drop that combines netarsudil – the active ingredient in its approved product, Rhopressa® 0.02% – with latanoprost, prostaglandin analog (PGA) that is the most commonly prescribed medication for lowering Inter Ocular Pressure (IOP) to treat glaucoma.

In recent news, ten days ago the FDA accepted Aerie’s IND application for AR-1105 (dexamethasone intravitreal implant) for the treatment of macular edema due to retinal vein occlusion. A

Disclosure: I am/we are long AERI, OCUL. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Biotech has gotten off to a solid start 2019 after deep losses in the fourth quarter. M&A has picked up as two major acquisitions have happened early this year. We just provided our 2019 Outlook to Biotech Forum members. It contains what we expect in this high beta sector for the rest of year as well as a couple of possible logical takeout candidates. To get it, access to our model portfolio and our investment analysis archives, sign up for your free 14 day trial into The Biotech Forum by clicking here. Hope to see you on Live Chat soon!

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