5. Marinus Pharmaceuticals, Inc. (NASDAQ:MRNS)
Number of Hedge Fund Investors: 19
A biopharmaceutical company, Marinus Pharmaceuticals, Inc. (NASDAQ: MRNS) is dedicated to the development and marketing of medicinal solutions for rare hereditary epilepsies and seizure disorders. ZTALMY, also known as ganaxolone, is the company’s primary asset. It was approved in early 2022 to treat seizures in both adult and pediatric patients caused by cyclin-dependent kinase-like 5 deficiency disorder (CDD). Ganaxolone is presently being evaluated by Marinus for other indications, which might lead to market expansion. With a market value of about $81.02 million, the stock trades at $1.48 per share as of June 17.
The management of the RAISE project has opted to cease patient enrollment, despite the recommendation of the independent data monitoring committee (IDMC) to continue the research involving about 100 patients. The outcome was an almost 80% decline in MRNS shares in April 2024, following the lead drug’s failure in the seizure study.
When Marinus Pharmaceuticals (NASDAQ:MRNS) said it was reducing staff by around 20% to cut costs, its shares dropped 9% following the release of its Q1 results report. Furthermore, it stated that in order to analyze research data and reassess its development plans for IV ganaxolone, it was postponing manufacturing investments in the drug and halting enrollment in its Phase 3 RAISE and RAISE II clinical trials.
The good news was that the revenue in Q1 2024 for Marinus’ medication Ztalmy, often referred to as ganaxolone, made an impressive growth by 125% to $7.5 million compared to the same quarter last year, indicating the future growth potential of not only the drug but also the company as a whole. However, the company’s performance fell short of street projections in terms of both top and bottom lines.
Despite the challenges, the company has long-term potential for Ganaxolone since it increased its initial projection of $32 million to $35 million in net product revenue in 2024, to $33 million to $35 million. MRNS’s management reaffirmed that ZTALMY and TSC initiatives are its top priorities. Moreover, Ganaxolone’s clinical trials showed a definite improvement in RSE patients. In Q3, there were 140 patients on ZTALMY, up from 120 in Q2.
The firm has beaten analyst EPS estimates in three out of its four latest quarters. Annual revenue jumped over the last three years. In 2023, it increased by 21.63% to $30.99 million from 2022 due to net product revenue growth.
Hence, due to the growth potential of its product, ZTALMY, and diverse pipeline, the stock has earned a consensus “buy” rating. Analysts predict an average price target of $10.86 within the next 12 months. The average price target represents a potential upside of over 638.78% from the current stock price of $1.47. In Q1 2024, 19 hedge funds were bullish on Marinus Pharmaceuticals Inc (NASDAQ:MRNS). Aaron Cowen’s Suvretta Capital Management is the largest stakeholder, with 5,108,520 shares valued at $46.18 million.
Orio Corporation, per agreement with MRNS, is working on the commercial launch of YMLATZ in a few European countries during the second half of 2024, planning to eventually expand access worldwide. This indicates that the company is expanding in the market.
Ganaxolone’s clinical results are critical to the company’s success; any setbacks or unfavorable findings might harm the company’s chances. Risks to market potential and revenue development are also posed by intense competition in the biotech industry and regulatory obstacles. The performance of ZTALMY is a major factor in the current bullishness among investors toward the company.
