Kamada Surges to Record on Inhaled Drug’s Trial Outlook

Kamada Ltd., the maker of treatments for hereditary lung disease, climbed to a record on speculation that results of clinical trials will boost profits.

The Nes Ziona, Israel-based company rose 1.7 percent to 49.19 shekels, or about $13.86, at the close in Tel Aviv. The New York shares closed at $13.66 yesterday, a 35 percent advance since their May 31 offering, with trading volume almost three times the three-month daily average. The benchmark TA-25 Index of stocks added 0.2 percent to 1,201.81, bringing the week’s gain to 2 percent.

Kamada announced last year an agreement with Chiesi Farmaceutici SpA for the exclusive distribution of the inhaled version of its medicine for a genetic condition called Alpha-1 Antitrypsin deficiency that can lead to liver and lung damage. The company expects to initiate a U.S. phase 2 study of an inhaled treatment in the second half of 2013 and to report the results of a European trial by early 2014, it said in an Aug. 1 statement. Adjusted net income will double to $5.9 million in 2013 and leap another 165 percent in 2014, according to the average of four analyst estimates compiled by Bloomberg.

“Should they bring the inhalable version of Antitrypsin to the market, they would capture a significant share,” Raj Denhoy, an analyst at Jefferies & Co. in New York, said by phone yesterday. “If the trial is successful, and I think there is a pretty good chance for it to be a success, Kamada will have the only inhalable version of the drug on the market. It’s a lot easier to consume the inhalable version.”

Jefferies estimates the market for the Antitrypsin drug at $800 million a year globally, including $600 million in the U.S.

Kamada said the Chiesi agreement could bring in $60 million if regulatory conditions and sales targets are met and estimates sales potential of “hundreds of millions of dollars.” The company already sells an intravenous version of the AAT treatment with Baxter International Inc.