Shares of Trevena (TRVN -0.91%) shot higher on Monday following a very bullish analyst report. Guggenheim initiated coverage on the stock, with prognosticator Dana Flanders rating it a buy with a price target of $5.00. Even after Monday's price hike, that level still implies potential upside of 140%.
Trevena is about to go to market with Olinvyk. This opioid received Food and Drug Administration approval last month for adult patients who suffer from acute pain serious enough to warrant the use of an intravenous opioid. It has the green light for use in hospitals or other controlled clinical settings.
This makes Olinvyk an exciting and innovative new entry in the pain management segment. In clinical trials, it demonstrated very fast-acting effects, relieving such pain in two to five minutes in some cases.
Trevena plans to roll out Olinvyk in the fourth quarter of this year. Those very encouraging trial results could ultimately make it a blockbuster drug. Flanders is estimating it will reap sales of $1 million in 2020 -- a level that will rise sharply to $16 million in 2021 and $171 million in 2025.
Like many biotechs, Trevena is young and has no experience getting a product to market; Olinvyk will be its first. While the drug certainly has great potential in a segment that has been rather overlooked, investor caution is warranted.