German research house GBC has started covering Ergomed Plc (LON:ERGO) with a 'buy' rating and target of 273p, saying it predicts sales to increase 15.8% in 2016 against 2015.
The group is pharma services firm that also takes a stake in drugs during the development process and is boosted by a successful treatment making its way through the clinical trials.
It currently has five products in the co-development pipeline at different stages.
GBC says its predicted growth stems from the group's 'solid' positioning in the market, its innovative clinical trials approach and its international positioning in the development services sector, coupled with the order backlog worth £59mln at the start of the year, which already covered 85% of the projected services business sales for 2016.
"In addition, the product portfolio is expected to reach important milestones over the course of 2016 and early 2017," said the research house.
Ergomed also has two proprietary internal drug development programs from the acquisition of Haemostatix which are expected to be particularly promising, added GBC.