NEW YORK – William Blair Thursday initiated coverage of Aspira Women's Health with an Outperform rating and a price target of $3.33 per share and coverage of DermTech with a rating of Outperform and a price target of $11.97 per share.
Aspira, formerly known as Vermillion, develops diagnostics in the women's health space. Its lead product, OVA1, is a proteomic test that is intended to help doctors assess whether women undergoing surgery for a pelvic mass should have that surgery done by a gynecologic oncologist.
Austin, Texas-based Aspira has struggled to drive adoption of OVA1 for almost a decade, but William Blair analyst Brain Weinstein wrote in a research note to investors that an increased salesforce and additional study data demonstrating the superiority of OVA1 to its comparator tests could improve uptake.
"As this all plays out, we believe the OVA product family is poised to increase its penetration in what is a 300,000- to 400,000-patient per year opportunity," Weinstein said. "Over the longer term, this uptake should provide a more entrenched commercial engine for when more meaningful products from the pipeline are launched.
He added that tests in the company's pipeline, most notably its EndoCheck test for diagnosing endometriosis could significantly expand the market addressed by the company's products.
La Jolla, California-based DermTech is targeting the skin cancer diagnostic market with its Pigmented Lesion Assay, a non-invasive approach to evaluating suspicious skin lesions. The company recently received Medicare coverage for the test, which Weinstein wrote targets the 4 million biopsies done per year for atypical skin lesions, a roughly $2.5 billion market.
"PLA is more sensitive, specific, and much less invasive versus standard of care. We believe these attributes should resonate with dermatologists in the coming years and drive uptake of the product," he said.
He added that the company's pipeline includes products addressing skin diseases that represent a market of around $10 billion.
In Friday morning trading on Nasdaq Aspira stock was $3.51 while DermTech was $12.55.