ADMA Biologics Shares Possibly Worth A Triple On FDA Approval Of RI-002

We are initiating coverage of ADMA Biologics, Inc. (ADMA) with a “Buy” rating and a $20 price target. ADMA recently announced positive Phase 3 data for lead product candidate RI-002, a plasma-derived intravenous immunoglobulin (IVIG) for the treatment and prevention of certain infectious diseases in Primary Immunodeficiency Disease (PIDD) patients. RI-002 contains high levels of standardized RSV antibody titers via a selective and proprietary donor screening process that differentiates the drug from other commercially available IVIG products. We believe that RI-002 will offer a superior treatment option for a subset of patients with PIDD, and other immunocompromised or immunosuppressed patient groups at high-risk for infections.

ADMA is currently assembling its Biologics License Application (BLA) for planned submission to the U.S. FDA at some point during the middle of 2015. We believe that if all goes well, FDA approval should take place during the second half of 2016. Management believes that first commercial sales could potentially occur as early as the second half of 2016. We think utilizing standardized high levels of anti-RSV neutralizing antibodies is a unique approach, and we view this as an area of unmet medical need for immunocompromised patients. At the current price, we view ADMA shares as meaningfully undervalued, and offer significant long-term upside potential.

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