Outlook Therapeutics: Hold Rating Amid Uncertainties in BLA Resubmission and Market Challenges

Analyst Douglas Tsao from H.C. Wainwright reiterated a Hold rating on Outlook Therapeutics and keeping the price target at $1.00.

Douglas Tsao has given his Hold rating due to a combination of factors surrounding Outlook Therapeutics’ current situation. The company plans to resubmit its Biologics License Application (BLA) for ONS-5010 by the end of the year following a meeting with the FDA. However, the approval process remains uncertain due to previous challenges, such as missing the primary endpoint in the NORSE 8 study and questions about the sufficiency of the non-inferiority margin at week 12.
While the FDA meeting was constructive, there is still ambiguity regarding the new analysis that the agency will consider, and whether the resubmission will be classified as Type 1 or Type 2. The company’s valuation reflects these uncertainties, with a price target of $1 based on risk-adjusted revenue estimates. Additionally, risks such as the sole focus on ONS-5010, potential competition, and the need for additional financing contribute to the Hold rating.