Galecto initiated with a Buy at Guggenheim on DMR-001 potential

As previously reported, Guggenheim initiated coverage of Galecto (GLTO) with a Buy rating and $32 price target. Galecto recently acquired the Paragon company Damora, which is developing DMR-001 in an emerging drug class led by Incyte’s (INCY) first-in-class INCA033989 that in phase 1 showed disease modifying efficacy and clean safety, notes the analyst, who adds that DMR-001 has “two valuable and interconnected improvements over INCA033989.” The firm thinks this targeted therapy class could eventually move to first-line and replace today’s non-specific and toxic cytoreductive drugs, the analyst said. Galecto is well-funded with about $300M through 2029 to initiate Phase 3 trials and potentially close the two-year gap behind Incyte, added the analyst.