WEST CHESTER, Pa. - Verrica Pharmaceuticals Inc. (NASDAQ:VRCA), a small-cap pharmaceutical company ($61.34M market cap) specializing in dermatology treatments, has reported promising results from a recent study of its investigational therapy, VP-315, for basal cell carcinoma (BCC). Despite the stock trading at $0.68, down 88.54% over the past year, InvestingPro analysis suggests the company is currently undervalued, with two analysts recently revising their earnings estimates upward for the upcoming period. The data, presented at the Winter Clinical Dermatology Conference in Miami, showed a 97% Objective Response Rate (ORR) among study subjects.
The Phase 2 study, which enrolled 92 adult subjects with biopsy-proven BCC, aimed to assess the safety, pharmacokinetics, and efficacy of VP-315 when administered intratumorally. According to the data, approximately 51% of treated tumors achieved complete histological clearance, with an average reduction in tumor size of about 71% for those with residual tumors. Importantly, there were no treatment-related serious adverse events reported, while most adverse effects were mild to moderate.
Verrica's post-hoc analysis highlighted the high ORR, which they define as the percentage of subjects who do not show disease progression and experience significant tumor reduction. The company is now anticipating genomic and T-cell data in the first quarter of 2025 and plans to request an End-of-Phase 2 meeting with the FDA in the first half of the year to discuss the development of VP-315.
The company's CEO, Dr. Jayson Rieger, expressed optimism about the potential of VP-315 to alter the treatment landscape for BCC, offering a non-surgical option for the millions diagnosed annually in the U.S. The study's findings could support VP-315 as a first-line therapy for BCC, aiming to provide an alternative to invasive surgical procedures. While the company demonstrated impressive revenue growth of 187.45% in the last twelve months, InvestingPro data indicates it's currently burning through cash, with negative free cash flow of $59.62M.
VP-315 is described as a potential first-in-class oncolytic chemotherapeutic peptide immunotherapy that could induce immunogenic cell death and stimulate tumor-specific immune responses. It has been tested for various skin cancers, including non-metastatic melanoma and Merkel cell carcinoma, with a focus on BCC and squamous cell carcinomas.
Basal cell carcinoma is the most common cancer in the United States, with 3-4 million new cases each year. Current treatments often involve surgery, which can lead to pain, infection, bleeding, and scarring. For investors seeking deeper insights into Verrica's market position and growth potential, InvestingPro offers an extensive research report with detailed analysis of the company's financials, market opportunities, and growth prospects, along with 8 additional ProTips that could help inform investment decisions.
This article is based on a press release statement from Verrica Pharmaceuticals Inc.
In other recent news, Verrica Pharmaceuticals reported an increase in dispensed units of its lead product, YCANTH, in Q4 and significant cost reductions in sales and operational infrastructure. TD Cowen revised its price target for Verrica to $10 from $15, maintaining a Buy rating. Meanwhile, Jefferies cut its stock target to $3 but maintained a Buy rating, and RBC Capital kept an Outperform rating while reducing the stock's price target to $13 from $14. However, Needham downgraded Verrica's stock from Buy to Hold.
Verrica also appointed David Zawitz as its new Chief Operating Officer following a comprehensive selection process by the Board of Directors. In collaboration with Torii Pharmaceutical (TADAWUL:2070), Verrica has submitted a New Drug Application in Japan for TO-208, aiming to introduce the first therapeutic for Molluscum Contagiosum in the country. These are among the recent developments for Verrica Pharmaceuticals.
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