Analysts at Maxim Group initiated coverage Friday of Hemispherx Biopharma Inc (NYSEAMERICAN:HEB) with a Buy rating and $8 price target on the stock.
At the core of the promising Ocala, Florida-based company’s pipeline is its flagship drug Ampligen (rintatolimod), an experimental ribonucleic acid that is in clinical trials to address both chronic fatigue syndrome and to treat multiple cancers.
“We are initiating coverage of Hemispherx Biopharma with a Buy rating and a $8 price target,” wrote Maxim Group analyst Jason McCarthy in a note to clients.
That represented a 53% upside as the stock is currently trading at $5.22.
“The company’s lead asset is Ampligen, a unique TLR3 agonist that reprograms the tumor microenvironment to become more responsive to other therapies, including checkpoints,” he added.
Given Ampligen’s strength in battling solid tumors, there are a series of cancer trials in various stages underway at major research hospitals. The studies are evaluating whether the combination of ampligen with checkpoint blockade therapies (powerful immunotherapy drugs that block proteins that restrain the body’s immune system from fighting cancer) will improve clinical tumor responses, time to progression and survival rates.
Upcoming data readouts
“Multiple early stage combination studies ongoing; a P1/2 and P2 in ovarian cancer, a P2 in triple negative breast cancer, and a P2a in colorectal cancer w/ liver mets and an expanded access program in pancreatic cancer (monotherapy),” wrote McCarthy.
“Data updates expected in 2019/20, as well as additional new studies initiating,” he added.
Hemispherx took a key step forward in its Phase 2 clinical trial on Wednesday after it announced that the first patient has been treated with its flagship drug Ampligen.
The study looks at the effectiveness of Ampligen in combination with the drug pembrolizumab at treating ovarian cancer. It is being run out of the University of Pittsburgh Medical Center.
Hemispherx believes that Ampligen could have anti-viral and anti-cancer properties. Prior clinical trials of the drug looked at patients with renal cell carcinoma and malignant melanoma.
McCarthy was unequivocal about the potential uspide Hemispherx offered early investors.
“As the immune-oncology (IO) space continues to grow from checkpoints and CART to vaccines, what's become more clear is that unlocking the larger market opportunities is going to take combinations, and sets the stage for Ampligen,” he wrote.
“With a $10M valuation and data updates expected over 2019 and 2020, which if positive, could demonstrate proof concept, we see upside,” he added.
Contact Uttara Choudhury at ut[email protected]