Maintaining Hold on Virios Therapeutics Amid Financial Strains and Clinical Development Risks

Sean Lee CFA, an analyst from H.C. Wainwright, maintained the Hold rating on Virios Therapeutics (VIRI – Research Report). The associated price target remains the same with $0.40.

Sean Lee CFA has given his Hold rating due to a combination of factors impacting Virios Therapeutics. The company’s recent financial results showed no revenues, aligning with consensus estimates, but a net loss per share greater than anticipated. Furthermore, Virios’s cash reserves are expected to sustain operations only until the third quarter of 2024, which adds a layer of financial uncertainty. Lee anticipates no revenues and a continuous net loss per share through the next year, indicating a tepid financial outlook for the company.

The hold rating also considers the potential upside from Virios’s ongoing Phase 2 study for long-COVID treatment, which could be a significant catalyst should it succeed. However, the need for a partnership to further develop the treatment due to resource constraints adds risk. Moreover, the fibromyalgia program’s future remains uncertain as the company seeks partners for Phase 3 trials. Lee maintains a neutral stance with a modest price target based on a risk-adjusted analysis of the company’s pipeline and projected revenues, factoring in various risks such as clinical, regulatory, commercial, collaboration, financial, and intellectual property.

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Virios Therapeutics (VIRI) Company Description:

Virios Therapeutics Inc is a development-stage biotechnology company. It is focused on advancing novel antiviral therapies to treat diseases associated with a viral triggered abnormal immune response such as fibromyalgia.