Verrica downgraded to Hold from Buy at Needham (yesterday)

As previously reported, Needham yesterday afternoon downgraded Verrica Pharmaceuticals to Hold from Buy without a price target The company announced a significant cost-cutting exercise to stay afloat given its dwindling cash balance and limited operational runway, the analyst tells investors in a research note. The firm says the over 50% downsizing of Ycanth’s promotional efforts will represent a “significant headwind for a launch that had shown recent signs of struggle.” While Needham believes in Ycanth’s potential in molluscum and common warts, the firm says the current focus is on addressing capital needs, which will likely require a “highly-dilutive” financing event.