Cerulean Pharma Inc (NASDAQ:CERU) shares skyrocketed 90% in the past two days, after the cancer drug firm said that it’s evaluating potential alternatives such as the sale of the company, a merger, a business combination, a strategic investment into the company, or a sale, license or disposition of assets of the company.
In its strategic review, the Board is considering, among other things, Cerulean’s clinical assets, NDC platform, and cash reserves as outlined below:
- Clinical assets: Cerulean’s platform-generated NDC programs, CRLX101 and CRLX301.
- NDC Platform: Cerulean’s Dynamic Tumor Targeting™ Platform which creates NDCs that are designed to provide safer and more effective cancer treatments.
- Cash Reserves: As of September 30, 2016, the Company had $38.1 million in cash and cash equivalents.
In his recent research note on CERU, Leerink Swann’s top analyst Michael Schmidt wrote, “CERU’s lead product CRLX-101 has failed in 2 randomized controlled Phase II trials in NSCLC and RCC, and we are cautious on CERU’s ability to maximize the value of the agent given capital restraints. We think the rationale to combine CRLX-101 with Lynparza, a PARP inhibitor is high, but the trial is in early stages and it may be difficult to interpret early stage single arm combination data. CRLX301, the company’s second NDC product, could differentiate from existing docetaxel formulations by a better safety/ efficacy profile, but is only in early stages of development and will need to compete with generic Taxotere.”
Schmidt rates CERU a a Market Perform, with a price target of $1.5, which implies an upside of 13% from current levels. According to TipRanks, which measures analysts’ and bloggers’ success rate based on how their calls perform, Schmidt is a top analyst holding a yearly average return of 25.5% and a 58.5% success rate. Schmidt is ranked #58 out of 4375 analysts.
Cerulean Pharma, Inc. is a clinical-stage, oncology-focused company, which provides proprietary Dynamic Tumor Targeting Platform to develop differentiated therapies. It specializes in the design and development of nanopharmaceuticals. Cerulean’s nanopharmaceuticals are drug-containing nanoparticles designed and optimized to enhance therapeutic agents, ranging from small molecules to therapeutic peptides and RNAi molecules.