Despite the recent market-wide pullback, oncology drug-maker Celsion (CLSN) is enjoying a breakout year, with shares up by 210% year-to-date. One Street analyst thinks the stock has a way to run yet.
Brookline Capital analyst Kumaraguru Raja reiterated a Buy rating on CLSN shares, while boosting his price target from $3 to $4. The new figure implies an 82% upside from current levels. (To watch Raja’s track record, click here)
So, what is Raja basing his confident take on?
On Monday, Celsion disclosed that the FDA has granted Fast Track designation for GEN-1, the company’s potential treatment for advanced ovarian cancer.
The DNA-mediated interleukin-12 (IL-12) immunotherapy has concluded a Phase 1b trial and paired with chemotherapy is currently being studied in a Phase 2 trial.
The treatment is derived from Celsion’s proprietary, synthetic, non-viral nanoparticle delivery system platform TheraPlas.
Fast Track status is not lightly granted and only given to treatments that fill an unmet medical need and which have shown to have an advantage over available therapies. Additionally, they provide better access to the FDA and help speed up development.
The FDA were evidently impressed with the Phase 1 data which showed that in seven out of eight patients (88%) GEN-1 led to complete tumor resection. In contrast, standard-of-care neoadjuvant chemotherapy on its own, displayed a 50% resection rate.
In line with a new price target, Raja made other adjustments to his Celsion model following the latest news.
“We are increasing the probability of success for GEN-1 in ovarian cancer to 60% and add pipeline premium to account for potential of PLACCINE DNA vaccine platform technology,” the 5-star analyst said. “We assume 20% peak penetration and assume a cost of treatment $60,000 per year on launch in 2024.”
Celsion exited 3Q20 with $18.3 million of cash in the coffers and last month raised $32.6 million in net proceeds from a stock offering. The strengthened balance sheet is expected to fund operations into next year, according to Raja.
“The company expects to manage expenses so that they are able to complete the Phase 2 OVATION study,” Raja summed up.
Celsion appears to be flying under the Street’s radar and currently Raja’s is the sole recent Celsion review. (See CLSN stock analysis on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.