AFT Pharmaceuticals Ltd (ASX: AFP) is worth at least triple its current value, and perhaps much more, according to analysts at Pitt Street Research, who recently published new research on the company.
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This ASX small cap has a strong market position
The analyst team said the company was one of the few ASX healthcare companies that had increased its revenue every year for close to two decades off the back of its core Maxigesic product – a fixed dose paracetamol-ibuprofen analgesic which is the number one seller across Australia and New Zealand in its category.
Pitt Street said that while the local markets continued to grow well, there was also a large opportunity offshore.
They said:
Overseas is where the growth engine will be and the US is the most consequential near-term commercialisation. The FDA approved Maxigesic IV (known as Combogesic IV in the US) in October 2023, following which AFT moved to establish hospital formulary access through the standard US hospital market entry pathway. Maxigesic IV's key selling point is that it is opioid-free. The opioid crisis has created sustained institutional and regulatory pressure on US hospitals to reduce opioid prescribing, and analgesics that can provide clinically meaningful post-operative pain relief without opioid exposure occupy an increasingly attractive formulary position. Maxigesic IV is positioned directly into this demand environment.
Pitt Street said management was guiding to at least NZ$300m in FY27 revenue, supported by nine licensing agreements closed in FY26.
This compares to revenue of NZ$254.7 million in FY26, up 22%.
But the company is also building a broader clinical pipeline, which Pitt Street said "positions AFT as a diversified pharmaceutical platform rather than a single-asset analgesic company''.
The research report added:
Over the past three to four years, AFT has undertaken an expansion of its commercial and clinical focus beyond the Maxigesic franchise. Even though Maxigesic is still its best-selling product, it is no longer fair to call it a 'one trick pony' – AFT is a diversified branded pharmaceutical platform rather than a single-product business that happens to also have some pipeline assets.
These included treatments for anaemia, eye infections, scarring, and skin infections.
Pitt Street Added:
Looking at the pipeline: multiple products are now registered and generating revenue in new markets, several late-stage clinical programs are approaching monetisation, and two significant partnership structures have been established to extend the company's injectable manufacturing and formulation capabilities.
Shares are looking cheap at current levels
Pitt Street values the company at $10.55 per share as a base case and $13.39 in an optimistic case, compared to the current share price of $3.29.
