This morning, Arrowhead Pharmaceuticals Inc (NASDAQ:ARWR) announced the initiation of its Phase II trial for its pipeline drug ARC-AAT, a RNAi based investigational medicine for alpha-1 antitrypsin (AAT) liver disease, set apart from current enzyme replacement therapies like Grifols’ Prolastin-C and Shire’s Aralast.
The trial intends to assess efficacy of patients with AAT liver disease through a pre-dose biopsy, seven intravenous q4W doses, and followed by a post-dose biopsy 183 days out. By the end of the year, the biotech firm will present Phase 1 data, but has yet to offer a schedule for potential readouts.
In light of today’s trial launch, which Chardan Capital analyst Madhu Kumar deems as “positive,” the analyst reiterates a Buy rating on ARWR with a price target of $10, which represents just under a 38% increase from where the shares last closed.
Ultimately, Kumar remains bullish on the firm for the following reasons: the company’s ARC-520 might have brought about key breakthrough data in HBsAG suppression in HBV, which will be crucial for establishing lasting HBV therapy. Additionally, combination therapies like ARC-520 that can accomplish lasting HBV suppression will become critical. The analyst also comments that the pipeline drug could be a catalyst for the firm if it succeeds as a more advanced and more effective drug than current rival HBV RNAi assets. Lastly, Kumar underscores that ARWR remains un-partnered, and a partnership announcement with RNAi companies in his opinion indicates a high alpha generation.
“While today’s news is a positive signal for Arrowhead, we feel it is important to note that subcutaneous administration of ALN-AAT will likely prove more favorable than the intravenous administration used for ARC-AAT (we note that the dosing frequencies between the two drugs are likely to be comparable, as preclinical data for ALN-AAT in non-human primates demonstrated efficacy with qM dosing). Considering the likely chronic dosing required for these drugs in AAT liver disease, Arrowhead’s asset will likely have to demonstrate an advantage in efficacy or safety to compete with ALN-AAT on the market,” he concludes.
As usual, we recommend taking analyst notes with a grain of salt. According to TipRanks, one-star analyst Madhu Kumar is ranked #3,507 out of 4,147 analysts. Kumar has a 55% success rate and faces a loss of 6.6% in his yearly returns. However, when recommending ARWR, Kumar earns 42.7% in average profits on the stock.
TipRanks analytics demonstrate ARWR as a Strong Buy. 100% of analysts polled in the last 3 months rate Buy on ARWR. The consensus price target stands at $11.50, marking a nearly 47% upside from where the stock is currently trading.