ZGNX - Zogenix: Management Misstep & Preclinical Uncertainty Sour Conviction
Introduction
Zogenix (ZGNX) is developing low-dose fenfluramine, ZX008, for the treatment of pediatric epileptic syndromes (e.g. Dravet and Lennox-Gastaut).
My original investment thesis in Zogenix was based upon the following beliefs:
- The efficacy of ZX008 supports use as standard-of-care, in combination with other drugs, for Dravet and Lennox-Gastaut syndromes.
- The safety issues regarding the historic use of fenfluramine in adult obesity are not likely to translate to ZX008 for Dravet and Lennox-Gastaut syndromes in any meaningful way, as to impact the potential of ZX008.
- Zogenix appears undervalued based upon the market opportunity of