Jaguar Health (JAGX) Stock: Digging Deeper Into This Potential Opportunity

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Another product that has led to excitement surrounding Jaguar Health’s veterinary therapeutic arm is known as EquileviaTM, a non-prescription, personalized, premium product for total gut health in equine athletes. Recently, the company announced that it had entered into a collaboration agreement with Seed Mena Businessmen Services LLC surrounding the treatment. This is incredible news, as SEED has strong affiliations in the industry that can lead to product expansion for EquileviaTM. In a statement, Lisa Conte, President and CEO at JAGX, had the following to offer:

The need for a personalized, premium product for total gut health in equine athletes was originally identified by the late Dr. Mike Hauser – Jaguar’s former chief veterinarian and the former head of the world-renowned Dubai Equine Hospital… Mike had an intimate understanding of the training conditions and value of equine health in the UAE, and he is frequently credited with being the primary force behind bringing leading-edge equine medicine and surgery to the Middle East. We’re very excited about a new potential approach for total gut health in competitive horses – and about our new partnership with SEED – and in the UAE region we plan to focus initial sales and collaborative efforts on particular stables, tailored to the particular equine husbandry practices of specific organizations and even individual high-end equine athletes. The terms of the Agreement reflect the financial impact we expect EquileviaTM to have on Jaguar’s business, with potentially hundreds to thousands of horses treated regularly to maintain wellness. We’re so pleased to have entered a collaboration intended to supplement our commercial human pharmaceutical business with a product designed for the most venerable participants in the sport of kings.

Finally, the company has a product known as NeonormTM Calf. The treatment is a non-prescription product that was designed to help dairies and beef farms proactively retain fluid in calves. Ultimately, this helps the animals to avoid debilitating and dangerous levels of dehydration. Neonorm is a botanical extract that is derived from the Croton Lechleri tree.

Jaguar’s Work In Human Medicine

While Jaguar Health’s primary focus is veterinary medicine, the company’s wholly-owned subsidiary (Napo Pharmaceuticals) is in the business of creating gastrointestinal treatments for humans. The human treatment in the spotlight at JAGX is known as Mytesi®. Mytesi® is a treatment designed for noninfectious diarrhea in adults with HIV/AIDS on antiretroviral therapy.

In mid-November, the company released sales highlights, showing that growth is happening. In fact from January 1, 2017, to October 31, 2017, sales totaled about $2.8 million. In the month periods from August through October, sales of the treatment increased more than 50% compared to average monthly sales of Mytesi®. In a statement, Lisa Conte, CEO at JAGX, had the following to offer:

The merger of Jaguar and Napo became effective on July 31, 2017. Napo’s receipt of cash is based on gross sales, defined as cashflow from the movement of product from our third-party logistics warehouse to wholesalers. Gross sales, in August, September, and October of 2017 were approximately $1.1 million for Mytesi®. With the onboarding of three additional HIV sales personnel this month, and the refilling rate of Mytesi® prescriptions for chronic disease, we expect continued growth for future Mytesi® sales.

Mytesi® is also being tested for various other indications. In fact, JAGX currently has the treatment in a Phase 2 clinical trial for the diarrhea-predominant irritable bowel syndrome indication. At the same time, there are two more phase 2 studies for the treatment, one for Travelers’ Diarrhea and the other for acute adult infectious diarrhea including Cholera. Finally, the company is in Phase 1 clinical development for the treatment in the pediatric acute diarrhea indication and in the planning stages for C difficile-related diarrhea. So, there are quite a few catalystic events likely on the horizons.

Risks Associated With JAGX

While the story sounds good to this point, every investment comes with risks, and an investment in Jaguar Health would be no different. There are a few things to consider when investing in the company:

  • This Space Is A Tough One – Even with FDA approval, the gastrointestinal treatment space is a tough one to tackle. As we’ve seen with Synergy Pharmaceuticals’ (NASDAQ: SGYP) FDA-approved Trulance, OTC competition is tough in this space, leading to slow growth. While we’re seeing strong growth in Mytesi® sales, it’s going to take quite a bit more for this treatment to become the cash cow investors hope it will be.
  • Finances Aren’t Great – At the moment, JAGX is in the early phases of commercialization of a single approved treatment in humans. At the same time, the company is marketing multiple OTC veterinary medications and getting close to the approval of Canalevia. However, the company is currently operating at a loss, and that’s always a concern. With so much going on, cash burn isn’t great and the company could need to raise money relatively soon. That’s not always a good thing for investors.
  • The Basics In Biotech – When we talk about small biotechnology companies as an investment, we’re talking about a risky venture. At the end of the day, whether you’re looking at Jaguar Health or any of the other options in the space, these companies are largely dependent on positive clinical results, regulatory approval, and the ability to sell their treatments once they make it to commercialization phases. Any slips in any of these areas can lead to dramatic declines.

Is Now The Time To Get Involved?

This is a tough question to answer without knowing your unique goals. However, JAGX may be the right choice for some. At the end of the day, the company does have quite a bit going for it with regard to both Mytessi and Canalevia. If these treatments prove to be hits, the stock could see some dramatic gains. Nonetheless, if you are going to consider an investment in the company, please be sure to do your due diligence and consider the risks.


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