Could XBiotech’s Convalescent Plasma Program Make a Breakthrough in Treating COVID-19 Patients?

High flying biotechs have been a theme so far in 2020. That’s not surprising, as the share appreciation for these companies has come hand in hand with a potential treatment or vaccination against COVID-19. The uptick in fortune hasn’t applied to XBiotech (XBIT), with the stock down 27% year-to-date.

It is worth remembering, though, that XBiotech stock soared by a massive 257% in 2019. Might it do so again this year?

Maybe not to such an extent, but one analyst believes the company’s platform to identify COVID-19 neutralizing antibodies is taking it in the right direction.

Piper Sandler’s Joseph Catanzaro reiterated an Overweight on XBiotech shares, but has adjusted the price target (on account a recent $420 million tender offering), from $28 to $18. Potential upside from current levels stands at 32%. (To watch Catazaro’s track record, click here)

XBiotech recently announced a collaboration with nonprofit BioBridge Global to collect and distribute convalescent plasma from patients who have overcome COVID-19. BioBridge subsidiary QualTex Laboratories will use a clinical test XBiotech has developed to identify naturally occurring neutralizing antibodies against COVID-19. Another BioBridge subsidiary, the South Texas Blood & Tissue Center, will collect the plasma and provide XBiotech with blood samples to use for the development of a True Human antibody therapy for the infection.

XBiotech’s True Human platform clones human antibody from individual blood donors with natural immunity. Its unique approach to antibody production could potentially improve on current methods of antibody generation.

The use of convalescent donor plasma has been receiving a growing amount of attention recently as a possible treatment for COVID-19, in the hope it can boost patients’ ability to fight the virus.

There is not enough data available yet on its efficacy, though JAMA (the Journal of the American Medical Association) recently published the results of a small case series of 5 Chinese patients treated with convalescent plasma.

“While interpretation of outcomes data is obviously limited by sample size, lack of control and concurrent use of other therapies, 3 of the 5 patients were extubated and discharged following infusion, and 1 patient was removed from ECMO while still intubated,” Said Catanzaro

Additional randomized data available from the treatment of 93 patients in Hong Kong during the H1N1 (swine flu) outbreak showed an improvement in mortality for patients treated with convalescent plasma.

No other analysts have published a rating on XBIT over the last 3 months, therefore, Catanzaro’s thesis provides its with a Moderate Buy consensus rating. (See XBiotech stock analysis on TipRanks)


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