Zura Bio initiated with a Buy at Ladenburg

Ladenburg initiated coverage of Zura Bio with a Buy rating and $10 price target. Tibulizumab was initially designed and developed by Eli Lilly (LLY), but was in-licensed in 2023 by Zura, which plans to repurpose tibulizumab to treat systemic sclerosis, or SSc, and Hidradenitis Suppurativa, or HS. Both SSc and HS indications for tibulizumab “make much sense to us,” says the firm, which sees “considerable evidence” of both IL-17 mechanism of action, or MoA, and BAFF MoA in independent and unrelated trials. Zura plans to start both SSc and HS trials in 2024 and the firm thinks “there is still a meaningful potential upside,” even accounting for “an inevitable financing dilution at some point next year,” the analyst added.