FLXN stock is moving higher in pre-market trading on Zilretta label expansion which caused analysts to upgrade the stock.

In after-hours on December 26, 2019, Flexion (Nasdaq:FLXN) announced that the FDA has approved a supplemental New Drug Application (sNDA) to update the product label for ZILRETTA (triamcinolone acetonide extended-release injectable suspension) for the treatment of osteoarthritis (OA) knee pain.

Key elements of the label update include:

Removal of language which stated that ZILRETTA was “not intended for repeat administration.” The updated label states that the “efficacy and safety of repeat administration of ZILRETTA have not been demonstrated.”

Inclusion of a study description and safety data from the single-arm, open-label Phase 3 repeat administration trial.

Removal of a misleading statement describing a single secondary exploratory endpoint in the original Phase 3 pivotal trial which compared ZILRETTA to immediate release triamcinolone acetonide crystalline suspension.

Inclusion of nonclinical toxicology data from previously submitted single and repeat administration studies in non-diseased animals.

“We are very pleased with the new product label as it achieves our primary goal of removing unclear language pertaining to repeat administration, which we believe was potentially confusing to patients, physicians and payers alike,” said Michael Clayman, M.D., President and Chief Executive Officer of Flexion. “In addition, we are gratified by the inclusion of safety data from our repeat administration trial and the removal of the inappropriate comparator statement. We believe the updated label supports our goal of seeing ZILRETTA become the leading intra-articular therapy for managing OA knee pain.”

Added John Richmond, M.D., Medical Director for Network Development, New England Baptist Hospital, “As both a clinician and a ZILRETTA patient, I have firsthand experience with the significant magnitude and duration of pain relief it can provide to people confronting knee OA. ZILRETTA is an invaluable non-opioid option for managing chronic OA knee pain, and it is encouraging to see a new product label that better informs clinical decision making.”

On December 27, 2019, Benchmark analyst Bruce Jackson raised his price target for Flexion Therapeutics to $25 from $19 after the company received FDA approval to update the product label for Zilretta for the treatment of osteoarthritis knee pain. Shares of Flexion are up 13% to $21.70 in premarket trading. The label update includes the removal of language which stated that Zilretta was “not intended for repeat administration.” The label now states that the “efficacy and safety of repeat administration of Zilretta have not been demonstrated,” the company noted. The revised product label should help Zilretta gain more widespread reimbursement from health insurers, Jackson wrote in a research note. The analyst, who reiterates a Buy rating on the shares, sees the new label as positioning Flexion for continued sales gains in 2020.

BTIG analyst Tim Chiang keeps his Buy rating and $27 price target on Flexion after yesterday’s product label update for Zilretta by the FDA, which included the removal of “not intended for repeat administration” statement. The analyst believes that the updated language is more favorable for the product as the label makes includes references to its 52-week Phase 3b repeat dosing study, calling it the “best case outcome” for Flexion. Chiang expects Zilretta sales to accelerate in 2020, with sales reaching as high as $500M or more by 2025.

Raymond James analyst Elliot Wilbur raised his price target for Flexion Therapeutics to $28 from $25 after the FDA approved Zilretta’s supplemental New Drug Application to revise the product label language with respect to repeat administration. While unlikely to “significantly alter” the launch trajectory, the news is a positive as it should drive higher utilization rate, as well as favorable marketability around Zilretta, Wilbur tells investors in a research note. The analyst reiterates a Strong Buy rating on Flexion shares.

Needham analyst Serge Belanger keeps his Buy rating and $36 price target on Flexion after the release of a “long-anticipated” Zilretta label expansion by the FDA. The analyst believes that the exclusion of “confusing language” from the label helps the company achieve its key goal of removing a “Limitation of Use” component for the drug positioning Flexion to better promote Zilretta usage. Belanger points to the company’s unveiling of the 2020 Zilretta sales guidance expected in early January as the next potential catalyst for the stock.

BMO Capital analyst Gary Nachman keeps his Outperform rating and $29 price target on Flexion after the FDA updated its Zilretta label, modifying the “Limitation of Use” component to the less onerous sounding “efficacy and safety of repeat administration of Ziretta have not been demonstrated” from “not intended for repeat administration”. The analyst believes that the update is “unlikely” to drive a major inflection in Flexion shares, but still contends that Zilretta’s momentum should “certainly strengthen” after this FDA revision.

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