| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 19.63 | 118 |
| Intrinsic value (DCF) | 1097.03 | 12089 |
| Graham-Dodd Method | n/a | |
| Graham Formula | 12.00 | 33 |
Zevra Therapeutics, Inc. (NASDAQ: ZVRA) is a biotechnology company specializing in rare disease treatments, leveraging its proprietary Ligand Activated Therapy (LAT) technology to develop prodrug versions of FDA-approved compounds. Headquartered in Celebration, Florida, Zevra focuses on high-need CNS disorders, including idiopathic hypersomnia (IH), narcolepsy, and stimulant use disorder. Its lead candidate, KP1077, is in Phase II trials for IH and narcolepsy, while KP879 targets stimulant use disorder. The company also markets AZSTARYS, an FDA-approved ADHD treatment, and APADAZ, a prodrug-based pain management therapy. With strategic collaborations like those with KVK-Tech and Commave Therapeutics, Zevra combines scientific innovation with clinical development to address unmet medical needs in rare diseases. Its rebranding from KemPharm in 2023 reflects a sharpened focus on rare therapeutics, positioning it as a niche player in the competitive biotech landscape.
Zevra Therapeutics presents a high-risk, high-reward opportunity for investors focused on rare disease biotech. Its pipeline, particularly KP1077 and KP879, targets underserved markets with significant unmet needs, potentially driving long-term value. However, the company’s negative EPS (-$2.28) and operating cash flow (-$69.7M) highlight financial risks, reliant on clinical success and commercialization of its candidates. The FDA-approved AZSTARYS provides near-term revenue, but competition in ADHD treatments (e.g., Shire’s Vyvanse) limits upside. With a market cap of ~$473M and a high beta (1.87), ZVRA is volatile and sensitive to clinical trial outcomes. Investors should weigh its innovative prodrug platform against cash burn and debt ($60.3M) before committing.
Zevra’s competitive edge lies in its LAT technology, enabling it to repurpose existing drugs into prodrugs with improved safety or efficacy profiles—a cost-efficient R&D strategy compared to novel drug discovery. Its focus on rare CNS disorders (e.g., IH) reduces direct competition, though niche markets pose commercialization challenges. AZSTARYS competes in the crowded ADHD space against blockbusters like Vyvanse, but its once-daily formulation and prodrug design differentiate it. KP1077 could capture IH/narcolepsy market share if approved, competing indirectly with Jazz Pharmaceuticals’ Xywav. However, Zevra’s small scale vs. giants like Jazz (market cap $7.3B) limits commercialization muscle, necessitating partnerships. Financial constraints further hinder aggressive pipeline expansion, making it vulnerable to larger rivals with deeper pockets. Its collaboration with KVK-Tech mitigates some manufacturing risks but doesn’t eliminate reliance on clinical milestones.