Phillip Securities has initiated coverage on iX Biopharma with a “buy” recommendation and target price of 45.5 cents.

This comes as the brokerage believes the biotech company could finally turn profitable in FY21 as its revenue could be bumped up by as much as 250%.

It notes that iX Biopharma has started to commercialise its WaferiX subligual delivery of drugs as the company plans to expand capacity.

Moreover, the out-licensing of its sublingual ketamine wafer, Wafermine, for Phase 3 development will be a major catalyst for the company, says Phillip Securities.

“Specialty pharmaceutical and nutraceutical drugs will benefit from the planned six-fold increase in production capacity to meet the expected surge in demand,” Phillip Securities analyst Tay Wee Kuang writes in a note dated Oct 2.

As at 12.06 pm, iX Biopharma was up 1 cent or 4.3% at 24.5 cents with 10.7 million shares changed hands.