Is Oramed bringing the gospel to diabetes patients? The company is developing oral insulin
Oramed Pharmaceuticals 60.66% shot up by 40% on the Tel Aviv stock exchange. Four days ago, Raghuram Selvaraju, H.C Wainwright analyst, published a Buy rating on Oramed Pharmaceuticals stock, which is also traded on Nasdaq, at 17$. Following his recommendation, the company's stock leapt upwards on Wall Street by about 55% in two days when it soared by 37.8% to a rate of 4.45$, at a value of 105 million dollars. The analyst believes the stock is worth three times that amount, but Prof. Miriam Kadron, head of R&D at Oramed and the inventor of the product claims that – "I'm no analyst, but 17 dollars is pretty low if the development is a success".
Today the stock adapted itself with a rise of 43.6%. So why is the stock soaring? Well the company, which develops orally delivered capsules for diabetes patients, announced in mid-October that it is entering phase 3 of clinical trials in the States, and it is the first to do so. "the diabetes drug market is huge and keeps on growing at a high rate. We're talking about an estimated 30-40 billion dollars, not 10-20 billion each year" says Josh Hexter, COO of Oramed, in an interview with Bizportal.
Around 10% of the world's population, 463 million human beings, suffers from diabetes and the world leaders in morbidity rates are China and India. According to the data presented by Oramed, there will be an additional 237 million by the year 2045, despite the growing awareness regarding healthy diet. "You can ask any doctor who treats diabetes patients, he'll tell you that most people aren't willing to change their lifestyle and eating habits", says Hexter, "they want a lozenge to solve the issue, and that's the reason the diabetes drug market will rake in billions. When you add up the patients in China, India and the US you reach billions".
Prof. Miriam Kadron, who is also the mother of the founder of the company Nadav Kadron, estimates that in about two years Oramed will be able to apply for permits to starts selling her product to the US market. This a drug that is delivered orally which makes it easier to use it and may even replace the intravenous treatment. This is Oramed' s big potential and the reason for the soaring of its stock.
If the drug gets approved the company will receive exclusive rights to the patent for a period of 12 years. Also, Kadron believes Oramed' s drug will save patients additional costs of insulin shots, which entails the cost of injection, needles, pads & disinfectant.
Oramed will be looking to add a partner for marketing purposes, says Hexter: our core is drug development and clinical trials. We need significant sales force to introduce the drug to the market, and we plan to achieve this with partnerships".
"People have been trying to develop an orally delivered diabetes drug since the 1920's without success" says Hexter, "entering the third phase of clinical trials is a historical milestone. As far as I know there is no other company which has reached the second phase with a product like ours. We are overjoyed and see the potential and I believe that the shareholders and onlookers will say that this is something that could be interesting. I hope we succeed in bringing this drug to the market and bring relief to millions of patients around the world".
