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Pulmatrix Will Regain Full Rights To PUR1800 After Termination Of Licensing Agreement; Shares Fall 16%
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Pulmatrix Will Regain Full Rights To PUR1800 After Termination Of Licensing Agreement; Shares Fall 16%

Pulmatrix is poised to regain full rights to its narrow spectrum kinase inhibitor (NSKI), including PUR1800. Johnson & Johnson Enterprise Innovation, a subsidiary of Johnson & Johnson, terminated Pulmatrix’s license, development and commercialization agreement sending Pulmatrix shares down 16%.

Pulmatrix (PULM) intends to continue developing PUR1800 and according to Chief Executive Officer, Ted Raad, regaining full rights should allow the company to advance assets that can address blockbuster markets.

The company has already completed a 28-day toxicology study that showed dose-proportional systematic exposure of PUR1800 reduced lung drug accumulation potential.

Raad stated, “With data from these studies expected before year end, we expect to be positioned to advance our planned Phase 2 study in AECOPD treatment, which has the potential for approximately $2.5 billion in U.S. peak net revenue potential.”

PULM shares gained 38% in 2020, however, the stock is down 9% year to date. (See Pulmatrix stock analysis on TipRanks)

Following the termination of the license and development agreement, H.C. Wainwright analyst Andrew S. Fein maintained a Buy rating on PULM, however, he lowered his price target to $5 from $10. This implies 363% upside potential from current levels.

On March 25, Fein told investors that in-house advancement of PUR1800 will yield top line data in 4Q21. “We believe that based on the current stage of development for treating acute exacerbations in chronic obstructive pulmonary disease (AECOPD) patients, we can anticipate clarity on PUR1800’s merits in 4Q21, with top-line data expected to indicate safety and tolerability along with exploratory target engagement and anti-inflammatory impact.”

The stock scores 4 out of 10 on TipRank’s Smart Score rating system, which implies that PULM is expected to perform in-line with market expectations.

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