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Osmotica Pharma: Eye-catching Or Still Obscure?

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Osmotica Pharmaceuticals plc (OSMT), which recently made its debut on the Nasdaq, is down 12% since its IPO while the iShares Nasdaq Biotechnology ETF (IBB) index has lost nearly 5% of its value for the same period.

Osmotica Pharma is a biopharmaceutical company focused on specialty products that target markets with underserved patient populations.

The Company's marketed products include promoted specialty neurology and women's health products, as well as non-promoted products, which are primarily complex formulations of generic drugs.

Osmotica also has two late-stage drug candidates - Ontinua ER (arbaclofen) for muscle spasticity in multiple sclerosis patients, and RVL-1201 for blepharoptosis, or droopy eyelid.

Ontinua ER is based on the Company's proprietary Osmodex drug delivery system, and has been designated by the FDA as an Orphan Drug in the indication of muscle spasticity in multiple sclerosis patients.

Enrollment in the phase III trial of Ontinua ER (arbaclofen) for muscle spasticity in multiple sclerosis patients has been completed. If all goes well as planned, the Company expects to submit the NDA for Ontinua ER during the second half of 2019.

The Company acquired the rights to RVL1201 last year when it acquired the outstanding stock of RevitaLid Inc. The phase III trial of RVL1201 in the treatment of acquired blepharoptosis is recruiting participants.

If approved, RVL1201 would be the first non-surgical treatment option approved by the FDA for droopy eyelid.

The currently marketed products of Osmotica include M-72 for ADHD in patients aged 13 to 65; Osmolex ER for Parkinson's and drug-induced extrapyramidal reactions in adults; Lorzone for muscle spasms; ConZip for pain; Divigel for menopause, and OB Complete for various dietary needs during prenatal, pregnancy and postnatal periods.

A full-scale roll out for Osmolex ER, an oral treatment for Parkinson's disease, which was approved by the FDA this February, is planned for January 2019.

The product sales account for a major chunk of the Company's total revenue, with royalty revenue and licensing and contract revenue accounting for the rest.

In the third quarter ended September 30, 2018, net loss narrowed to $4.99 million or $4.99 per share on total revenue of $66.35 million. This compared with a net loss of $12.27 million or $12.27 per share and revenue of $53.74 million in the year-ago quarter.

The Company ended the third quarter of 2018 with cash of $32.2 million, and debt of $321.9 million.

Osmotica Pharma went public on the NASDAQ Global Select Market on October 18, 2018, offering its shares at a price of $7.00 per share. The stock opened at $9 in its market debut, and closed the first day of trading at $8.15.

OSMT closed Friday's (Nov.30) trading at $7.88, up 12.57%.

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