SIGA - SIGA Technologies: BARDA Contract Renewal Required To Sustain Recent Momentum (Rating Downgrade)
2024-06-12 23:45:47 ET
Summary
- SIGA Technologies is a pharmaceutical company selling TPOXX to the US and international governments, with a profitable business model.
- Revenue primarily comes from contracts with the US government, with potential risks due to heavy reliance on BARDA contract renewal.
- This contract may be renegotiated with a few issues, and approvals in PEP and pediatric settings, although seemingly it is not yet confirmed.
- SIGA stock can spike when infectious disease scares occur - i.e. in 2022 during a mpox outbreak, but generally speaking, the company is fairly valued, with a small market restricting growth prospects.
Investment Overview
SIGA Technologies (SIGA) is a New York based, commercial stage pharmaceutical company with a niche product. To quote from the company's Q1 2024 quarterly report / 10Q submission :
SIGA Technologies: BARDA Contract Renewal Required To Sustain Recent Momentum (Rating Downgrade)The Company sells its lead product, TPOXX® ("oral TPOXX®," also known as "tecovirimat" in certain international markets), to the U.S. Government and international governments (including government affiliated entities). Additionally, the Company sells the intravenous formulation of TPOXX® ("IV TPOXX®") to the U.S. Government.
TPOXX® is an oral formulation antiviral drug for the treatment of human smallpox disease caused by variola virus. On July 13, 2018, the United States Food & Drug Administration ("FDA") approved oral TPOXX® for the treatment of smallpox. The Company has been delivering oral TPOXX® to the U.S. Strategic National Stockpile ("Strategic Stockpile") since 2013.
In connection with IV TPOXX®, SIGA announced on May 19, 2022 that the FDA approved this formulation for the treatment of smallpox.
In addition to being approved by the FDA, oral TPOXX® (tecovirimat) has regulatory approval with the European Medicines Agency ("EMA"), Health Canada and the Medicines and Healthcare Products Regulatory Agency ("MHRA") of the United Kingdom.
The EMA and MHRA approved label indication covers the treatment of smallpox, monkeypox ("mpox"), cowpox, and vaccinia complications following vaccination against smallpox. The Health Canada approved label indication covers the treatment of smallpox.