Analyst Brandon Folkes of H.C. Wainwright maintained a Buy rating on Eupraxia Pharmaceuticals, retaining the price target of $12.00.
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Brandon Folkes has given his Buy rating due to a combination of factors that highlight the potential of Eupraxia Pharmaceuticals’ lead asset, EP-104GI, in treating eosinophilic esophagitis (EoE). The recent results from Celldex’s Phase 2 study, which failed to show symptom improvement despite mast cell reduction, underscore the complexity of EoE and the limitations of targeted biologics. In contrast, Eupraxia’s EP-104GI offers a more comprehensive approach by addressing a broader range of inflammatory processes with its long-acting fluticasone propionate formulation.
The ongoing RESOLVE trial has already shown promising results in terms of drug durability and treatment outcomes, with no serious adverse events reported. The potential for once-annual dosing aligns well with patients’ annual endoscopy schedule, further enhancing its appeal. Eupraxia’s valuation is supported by a probability-weighted clinical net present value model, with a 70% probability of success for EP-104GI and peak sales projected to exceed $500 million. While there are risks associated with clinical development, regulatory approval, and market competition, the removal of a potential competitor and the validation of Eupraxia’s approach strengthen the Buy recommendation.
Folkes covers the Healthcare sector, focusing on stocks such as Omeros, Eupraxia Pharmaceuticals, and Trevi Therapeutics. According to TipRanks, Folkes has an average return of -5.5% and a 36.33% success rate on recommended stocks.