Fennec: Japanese PEDMARK Success and Debt Elimination Drive Upside Potential and Support Buy Rating

H.C. Wainwright analyst Ram Selvaraju reiterated a Buy rating on Fennec Pharmaceuticals today and set a price target of $13.00.

Ram Selvaraju has given his Buy rating due to a combination of factors related to both clinical progress and financial de-risking. He points to the positive topline outcome of the Japanese Phase 2/3 STS-J01 trial of PEDMARK, which demonstrated a meaningful reduction in cisplatin-related hearing loss in children and adolescents compared with historical control data from prior pivotal studies. The trial also showed that PEDMARK did not diminish cisplatin exposure or compromise antitumor efficacy, as reflected in a very high overall tumor response rate, and the safety profile appeared favorable with no treatment-emergent adverse events attributed to the drug. Selvaraju also highlights the strategic importance of these data for a potential future registration path and partnering or licensing opportunities in Japan, creating an additional, currently unmodeled upside to the company’s valuation.

In parallel, Selvaraju views the company’s recent balance sheet actions as significantly improving its financial profile. Fennec fully repurchased and redeemed its outstanding convertible notes, eliminating all debt and removing an interest-bearing obligation that would have persisted into 2027. This deleveraging, funded through recent equity financings, reduces financial risk and gives the company more flexibility to invest in PEDMARK’s commercial and geographic expansion. Together, the strong clinical evidence from Japan and the strengthened capital structure underpin Selvaraju’s conviction that Fennec’s shares offer attractive upside potential at current levels, supporting his Buy rating.