Shares of Regulus Therapeutics Inc (NASDAQ:RGLS) tumbled 11% today, following the news that the company had received written communication from the FDA requesting additional safety analyses of RG-101, a miR-122 inhibitor for the treatment of chronic hepatitis C virus, in both pre-clinical and clinical studies. As a reminder, Regulus received notification from the FDA placing RG-101 on clinical hold, following a second case of jaundice 117 days after RG-101 dose in an end-stage renal disease patient infected with HCV.
Chardan Capital analyst Madhu Kumar believes that the FDA review process makes it reasonably possible RG-101 will continue development without effective delay. The analyst noted, “To us, the timeline presented by Regulus and the FDA (early 4Q16 filing of a response to the formal letter, with 30 days until a regulatory decision) is consistent with the company continuing RG-101 development with essentially no delay.”
“Recall that in the three current clinical trials for RG-101, treatment with RG-101 was completed before the clinical hold was initiated, and the trials were allowed to continue to collect data. As such, data for RG-101 from these trials will continue to accrue as if no hold were in place, and the hold could be lifted before the GSK trial is expected to complete in the end of 2016. This is important, as the follow-on trial of the Regulus/GlaxoSmithKline collaboration (expected to begin in the end of 2016) would be a phase II study combining a single dose of RG-101 with a long-acting parenteral formulation of GSK2878175, constituting a potential one-visit treatment for HCV which would be highly disruptive,” the analyst continued.
Kumar reiterated a Buy rating on shares of Regulus, with a price target of $12, which represents a potential upside of 224% from where the stock is currently trading.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Madhu Kumar has a yearly average return of -4.5% and a 40% success rate. Kumar has a -15.1% average return when recommending RGLS, and is ranked #3126 out of 4087 analysts.
Out of the 7 analysts polled by TipRanks, 6 rate Regulus Therapeutics Inc stock a Buy, while 1 rates the stock a Hold. With a return potential of 291.4%, the stock’s consensus target price stands at $14.50.