Evofem Biosciences, Inc. (NASDAQ: EVFM)

 

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Evofem Biosciences, Inc. (NASDAQ: EVFM)

          Website: www.evofem.com

 

Evofem Biosciences, Inc. (NASDAQ: EVFM) did a reverse split on May 6, then an underwritten public offering of 22,665,000 shares of its common stock and 12,835,000 pre-funded warrants through Piper Sandler & Co. The offering was completed in a terrible market, and the stock in spite of record results, dropped to a new all-time low. It's illegal for a fund manager to short a stock and cover from a direct offering. Maybe a few did? Regardless, Evofem received net proceeds from the offering of approximately $18.8 million, so there should not be any additional dilution near-term. With a $16 million market cap the stock is trading just above trailing 12 revenues of $11.3 million and at a huge discount to EVFM's 2022 fiscal year guidance of $30 to $35 million. This weakness in the stock price gives investors like us an opportunity to buy shares of this growing company. The 10-day average volume is about 1 million shares, so there is plenty of liquidity. I own the stock personally, and my plan is to sell some at higher prices and hold the rest for free, or a reduced cost. Two analkysts adjusted their [pice targets. Both are much higher than where the stock trades today.

Piper Sandler issued a research report on May 25, 2022 with a $2.00 price target.  

Laidlaw and Co. issued a research report on June 2, 2022 with a $3.50 price target.

6-1 chart 3
 

Evofem Biosciences, Inc. (NASDAQ: EVFM) makes Phexxi, the first FDA-approved, hormone-free, on-demand prescription contraceptive vaginal gel method of birth control used for the prevention of pregnancy. Phexxi comes in a box of 12 pre-filled applicators and is applied 0-60 minutes before each act of sex. Phexxi is FDA approved and currently on the market. In the first quarter of fiscal 2022, there were 27,053 units dispensed, which resulted in net product sales of $4.3 million, which was a 19% increase from the previous quarter. 

Evofem_2_t670

Already approved by the FDA as a contraceptive, Phexxi is also in development for two potential new indications, which include the prevention of chlamydia and gonorrhea in women. In March 2022, Evofem completed enrollment in EVOGUARD, the confirmatory Phase 3 clinical trial to evaluate the safety and efficacy of Phexxi for the prevention of urogenital Chlamydia trachomatis and Neisseria gonorrhoeae infection in women. Top-line results are expected in the second half of 2022.

EVO100 has been granted Fast Track Designation for the prevention of chlamydia in women and the prevention of gonorrhea in women and is designated a Qualified Infectious Disease Product (QIDP) for both indications by the U.S. Food and Drug Administration.

 

 Six reasons to buy EVFM right now:

  1. Evofem increased Phexxi net product sales 19% to $4.3 million for the first quarter of 2022 vs. fourth quarter 2021.
  2. Evofem reduced its selling and marketing costs by 49% and its total operating expense by 19%.
  3. The stock has been crushed, is trading at half of 2022 sales estimates, is trading in oversold territory on the MACD, and there's probably a huge short position that will be covering soon!
  4. Evofem received confirmation three weeks ago from one of the largest Pharmacy Benefit Managers (PBMs) in the nation that they will add Phexxi to their national template formularies with no restrictions. PBMs are companies that manage prescription drug benefits on behalf of health insurers, Medicare Part D drug plans, large employers, and other payers. Three large PBMs — CVS, Express Scripts, and UnitedHealth's Optum — account for more than 70 percent of claims volume. 
  5. Great news coming from the Affordable Care Act
  6. Another vaginal gel for the prevention of urogenital transmission of Chlamydia trachomatis infection and Neisseria gonorrhoeae infection in women is coming soon! It has been Fast Tracked by the FDA!

Check out this interview with Evofem Bioscience CEO, Saundra Pelletier https://youtu.be/ExLMIyNNqic.
Also, here is a great article in Inc. Magazine about this dynamic lady who is changing women's health forever.
Evofem Bioscience website: https://www.evofem.com
Phexxi website: https://www.phexxi.com
Evofem Bioscience Investor Overview: https://evofem.investorroom.com


Evofem has been hammered by the shorts, who will probably be forced to cover. Evofem did a 1-for-15 reverse stock split on Thursday, May 5, 2022, which left the company with about 12.5 million shares outstanding. Then the Company did a registered offering with Piper Sandler. On a fully diluted basis there are 44.1 million shares out, which gives EVFM a market cap of $16 million at the current price. EVFM is expecting sales in $39 to $35 million range this fiscal year, so the stock is trading at half of sales, when the average biopharma is trading five times sales. 

Here's where it gets good: Evofem posted $8.24 million in product sales for fiscal 2021. Not only did Evofem, with its ridiculous $16 million market cap, do $8.4 million in sales for 2021, Evovem did $4.3 million in sales in the first quarter of 2022, or about $11.3 million for the trailing 12 months.  You know why this is a big deal? Because, according to CSIMarket, the average Biotechnology & Pharmaceuticals Industry stock trades at 5.47 times trailing 12-month sales! So, EVFM should have a market cap of around $55 million. With 44 million shares out, that's over $1 per share! If that's not enough to get your small-cap stock infused blood pumping, Evofem said on its May 4, 2022 analysts call the company "expects 2022 net product sales will be in the range of 30 million to 35 million based on the current business with momentum building in the second half of the year."  

Phexxi - The First and Only Hormone-Free, On-Demand Prescription Contraceptive Vaginal Gel

In the interest of getting you timely information, this is copied directly from Evofem's website. I encourage you to do some more research. Phexxi vaginal gel provides women an in-the-moment contraceptive that can be easily applied 0-60 minutes before each act of intercourse and works by maintaining the baseline vaginal pH environment.

Baseline vaginal pH levels can range from 3.5 to 4.5. When semen enters the vagina, it raises the vagina’s pH level, which allows sperm to be mobile and swim up the reproductive canal. Phexxi works to keep vaginal pH in the baseline range of 3.5 to 4.5, which lowers sperm mobility, lowering the chance of sperm reaching the egg.

Women should not have to rely on a daily ritual, their partner, an invasive procedure, or an injection from their physician to protect themselves from unwanted pregnancy. Many women seek a safe, FDA-approved localized method of birth control that does not require the introduction of hormones into their bodies.

Because Phexxi is a non-hormonal birth control, it is not associated with side effects like depression, mood swings and irritability. Taking hormones may not be right for some women, especially for those with certain medical conditions including clotting disorders and most cancers, limiting their birth control options.

Phexxi provides a hormone-free contraceptive option for women who cannot or do not want to use a hormonal contraceptive as their birth control method. Phexxi is the hormone-free birth control women have been waiting for.

Proven Safe and Effective

Phexxi is 93% effective at preventing pregnancy when used as directed by a healthcare provider.

Phexxi is 86% effective with typical use; typical use includes women who may not have correctly followed the Instructions for Use during the clinical trial.

2011 Affordable Care Act = Free Birth Control

This is not being enforced, but it will be on January1, 2023. This is going to be a big win for EVFM! 

In 2011, President Obama signed the birth control mandate into law as part of the Affordable Care Act (ACA). Since the birth control mandate came into effect, the number of women with out-of-pocket expenses towards contraceptives dropped from 21% to 3%. What most people understand about the mandate is that birth control became free

Before the birth control mandate passed, women were required to pay out-of-pocket costs for birth control alongside their health insurance premium and yearly deductible. After the birth control mandate was signed into law, women in the United States no longer had to pay those out-of-pocket costs, as the ACA required insurance companies to cover contraceptive methods and counseling even if they hadn’t met their deductibles.   

Roe vs. Wade

The Supreme Court has voted to strike down the landmark Roe v. Wade decision, according to a leaked initial draft majority opinion written by Justice Samuel Alito. Maybe it's true, maybe it's not? If it is true, FDA-approved contraceptives, like Phexxi, are going to be in big demand. 
   
Chlamydia amd Gonorrhoeae

Evofem is also involved in the development of EVO100, an antimicrobial vaginal gel for the prevention of urogenital transmission of Chlamydia trachomatis infection and Neisseria gonorrhoeae infection in women. Evofem’s pipeline includes programs developing Phexxi for the prevention of two common STIs and EVO200 to reduce recurrent Bacterial Vaginosis (BV).

Every day, more than 1 million new cases of sexually transmitted infections (STIs) are acquired worldwide among people aged 15-49 years.4Every sexually active woman, no matter what form of contraception she is using, is potentially at risk to contract an STI. 

In the United States, the CDC estimates that 4.0 million and 1.6 million new cases of chlamydia and gonorrhea, respectively, occurred in 2018 alone.6 The number of reported cases is lower than the estimated total number because infected people are often unaware of, and do not seek treatment for, their infections. Almost 60% of women infected with chlamydia have no symptoms.7 

Chlamydia and gonorrhea have been reported to be responsible for one-third to half of pelvic inflammatory disease (PID) cases.  PID can cause serious, long-term problems including infertility, ectopic pregnancy, and chronic pelvic pain.8

In 2020, Evofem initiated EVOGUARD, a confirmatory Phase 3 clinical trial to evaluate the safety and efficacy of EVO100 (the investigational name for Phexxi) for the prevention of urogenital transmission of chlamydia and gonorrhea in women. Top-line study results are expected in the second half of 2022.

The U.S. Food and Drug Administration granted EVO100 (Phexxi) Fast Track designation for the prevention of both chlamydia and gonorrhea. Fast Track designation is designed to facilitate the development and expedite the review of new therapies to treat serious conditions and fill unmet medical needs.

Additionally, the FDA has awarded EVO100 (Phexxi) Qualified Infectious Disease Product (QIDP) designation for the prevention of both chlamydia and gonorrhea in women. A drug that receives QIDP designation may qualify for an additional five years of marketing exclusivity.

EVOGUARD builds on the positive, statistically significant results of the Company’s AMPREVENCE Phase 2b clinical trial. This landmark study met its primary and secondary endpoints, demonstrating a 50% relative risk reduction in chlamydia infection and a 78% relative risk reduction in gonorrhea infection compared to placebo.5 The AMPREVENCE manuscript was published in the prestigious peer-reviewed journal American Journal of Obstetrics and Gynecology in 2021.

Assuming FDA approval for these potential new indications, Phexxi is expected to be the first prescription product approved to address this critical large unmet medical need. 

Summary

  1. Evofem increased Phexxi net product sales 19% to $4.3 million for the first quarter of 2022 vs. fourth quarter 2021.
  2. Evofem reduced its selling and marketing costs by 49% and its total operating expense by 19%.
  3. The stock has been crushed, is trading at half of 2022 sales estimates, is trading in oversold territory on the MACD, and there's probably a huge short position that will be covering soon!
  4. Evofem received confirmation three weeks ago from one of the largest Pharmacy Benefit Managers (PBMs) in the nation that they will add Phexxi to their national template formularies with no restrictions. PBMs are companies that manage prescription drug benefits on behalf of health insurers, Medicare Part D drug plans, large employers, and other payers. Three large PBMs — CVS, Express Scripts, and UnitedHealth's Optum — account for more than 70 percent of claims volume. 
  5. Great news coming from the Affordable Care Act as the government enforces the "no deductible on birth control" part.
  6. EVFM could get favorable results from the FDA any day on tests for the prevention of urogenital transmission of Chlamydia trachomatis infection and Neisseria gonorrhoeae infection in women. EVO100 (Phexxi) has been Fast Tracked by the FDA!


NASDAQ Symbol: EVFM

Current Price: $0.35

Shares Outstanding:

44.1 million

Market Cap: $16 million

52 Week Trading Range:

52-Week Low: $0.33

52-Week High: $21.30

Corporate Offices:

12400 High Bluff Drive, Suite 600
San Diego, CA 92130
 
Investor Contact:

Amy Raskopf
Vice President of Investor Relations

858-550-1900 Ext. 167

917-673-5775

araskopf@evofem.com


Website: 
https://www.evofem.com