CYTR Cytrx Corp. (MM)

Derma Sciences delivered a robust Q414 with rebounding sales growth but slowing cost growth. Based on lower overhead and R&D costs, we have tempered our forecast losses 2015-16e and our DCF-based valuation has been raised from $312m to $320m. Accelerated recruitment in the ongoing diabetic foot ulcer trials (DSC127) and improved cost absorption in Advanced Wound Care may lead to profitability as of 2018.

Derma Sciences is a specialty medical device/pharmaceutical company. It focuses on developing and commercialising traditional and novel advanced wound care products, including MEDIHONEY and TCC-EZ, among other brands, and DSC127, a novel pharmaceutical agent for wound healing. It is headquartered in Princeton, New Jersey, US.

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