Why Aegis Capital Loves Adamas...And How To Bet On Parkinson's Treatment

• The share price of Adamas Pharmaceuticals, Inc. (NASDAQ: ADMS) has risen a little over 13 percent year-to-date.
• Aegis Capital’s Robert LeBoyer has initiated coverage of Adamas Pharmaceuticals with a price target of $29.
• LeBoyer expects the stock to be driven by the Phase III data for its lead drug, Nurelin, as well as data from the clinical trials of the company’s other pipeline drugs.

According to the Aegis Capital report, Adamas Pharmaceuticals’ “lead drug in development, Nurelin or ADS-5102, is in Phase III trials to prevent a side effect of medication for Parkinson's disease that causes uncontrolled movements (dyskensia).”

The company is also testing a second application of the drug in MS and has just started Phase II trials for this. The company has also developed technologies to enhance the pharmacological effects of existing drugs.

“By starting with an approved drug with an established market, the risk of development is lower than developing an entirely new molecule. It also permits the company to reference the approved drug it its regulatory filings, requiring shorter trials than if it were an entirely new molecule,” LeBoyer explained.

Adamas Pharmaceuticals is currently focused on chronic disorders of the central nervous system. Its lead pipeline candidate, Nurelin, is a proprietary formulation of amantadine and addresses the side effects of levodopa induced dyskinesia, which affects about 15 percent of Parkinson’s patients in the US.

Data from the Phase III trials is expected in 1Q2016. The Phase II study on the drug assesses the safety and walking improvement in Multiple Sclerosis patients with disability.