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Roth Capital Partners initiates coverage in Q BioMed with a Buy rating and $6.75 price target

Last updated: 14:10 28 Jun 2018 EDT, First published: 12:29 28 Jun 2018 EDT

Cancer in a headline
QBioMed also has a pipeline of early stage drugs to fight autism, liver cancer and glaucoma

Roth Capital Partners has initiated coverage of Q BioMed Inc (OTCMKTS:QBIO) with a Buy rating and a US$6.75 price target ahead of the expected launch of Strontium 89, its bone cancer pain treatment.

Q BioMed must still receive manufacturing approval to launch Strontium 89, a generic radiopharmaceutical that treats metastatic cancer bone pain, which is likely to hit the market early next year. But Roth analyst Scott Henry is bullish on this drug’s ability to boost profits.

“The impetus for our Buy rating on QBIO shares is the potential for a strong launch for the bone cancer pain treatment Strontium 89,” he wrote in a note to investors.

Read: QBioMed unveils advances in its Tie2 activating molecule for use in glaucoma treatments

The generic form of Metastron, Strontium 89 is an FDA-approved injection that differs from current bone-pain treatments as it’s not an opioid and its pain-killing effects tend to last longer, with some patients requiring as few as two treatments per year.

Strontium was approved by the FDA in 1993, but Q BioMed is still waiting for the FDA's manufacturing approval of the drug, which could come by year's end. Meanwhile, if the company doesn't meet its short-term need for additional financing, it could have an adverse impact on the shares, Henry cautioned.

More prospects in the pipeline

In addition to its work with Strontium 89, Q BioMed is working on other early stage drugs. QBM-001 is a developmental compound treating autism, which could enter clinical trials next year; Uttroside-B aims to treat liver cancer; and MAN-01 is a developmental compound for glaucoma.

While Henry described his hopes for the remainder of the drugs in Q BioMed’s pipeline as "minimal," validation of any program could have "a material positive impact on the share price."

Q BioMed shares were slightly lower Thursday afternoon at US$3.40.

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