GenVec climbs on “excellent news” for investors, says H.C. Wainwright
Thursday, October 30, 2014 12:19
(Before It's News)
GenVec (NASDAQ:GNVC) advanced Thursday after H.C. Wainwright analyst Reni Benjamin reiterated his buy rating on the company and 12-month price target of $9.
Shares were currently up 2.3 percent at $1.82 in New York.
On Wednesday, the company announced that the first patient has been treated in a phase 1/2 trial of its lead gene therapy program for hearing loss, partnered with Novartis (NYSE:NVS).
“We believe this announcement should be viewed as excellent news for investors. In our opinion, dosing of the first patient confirms to us that Novartis’ commitment to GenVec and the CGF166 program remains firm,” wrote Benjamin in his note released earlier Thursday.
“While the initiation of the study brings us one step closer to data release, investors should also be aware that event triggers a $3 MM milestone payment to GenVec.
“With the lead program in the capable hands of a conservative and diligent large Pharma partner, multiple milestone payments tied to the advancement of the clinical program, a low annual burn rate, and $15.8 MM in cash (pro forma), we believe GenVec represents an undervalued innovator in the new arena of gene therapy addressing indications with no therapeutic options.”
The company said yesterday that the first patient was dosed with CGF166, an investigational gene therapy involving ATOH1, which is a protein required for formation and differentiation of sensory hair cells. These cells work to convert sound waves into electrical signals, and are typically destroyed in patients with sensorineural hearing loss.
The trial will test the therapy in patients with severe to profound bilateral hearing loss, and is being conducted at three of Novartis‘ investigative sites, GenVec said. Initial results are expected by the second half of next year.
The study will examine safety, dosing and the efficacy of the therapy, and will be divided into three different parts. Patients will be evaluated at weeks one, two and four, and every month following for six months post-treatment.
The H.C. Wainwright analyst noted that preclinical results in mice have indicated success.
He also highlighted that GenVec’s core technology platform should be leveraged through additional collaboration. The company is continuing to seek partners to develop its technology and preclinical vaccine candidates for RSV and HSV. If successful, Benjamin said the company could secure upfront licensing and milestone payments.
