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Updates from ASH reinforce analyst's big price target potential

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Streetwise Reports
0 Comments|December 21, 2017

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In a Dec. 15 research note, Fein reported that he "remains bullish" on Kadmon Holdings Inc.'s (KDMN:NYSE) therapeutic, KD025, in chronic graft versus host disease (cGVHD), after updated data were presented at the American Society of Hematology's recent annual meeting.

These results, from an additional cohort of 40 patients receiving an "optimal dose" of KD025, a small molecule inhibitor of ROCK2, revealed three major findings, suggested Fein.

First, the data confirmed that the clinical benefits of KD025 in cGVHD were "comparable" to those of ibrutinib, which the FDA approved in August for adults with the condition, Fein described. Specifically, the overall response rate with KD025 was 64%, whereas that with ibrutinib was 67%.

Second, the data revealed the benefit and safety of KD025 in cGVHD to be superior to those of ibrutinib, Fein indicated. In the trial of KD025, patients' infection risk did not increase, no patients reported fungal infections and no patients stopped the therapy due to adverse effects. The same were not true in the ibrutinib study: 69% of patients had infectious complications, and 33% of patients discontinued treatment due to adverse effects after a median 1.8 months.

"Therefore, in our opinion, a very similar overall response rate but with a significantly improved safety profile should provide an advantage toward KD025 in the eyes of both providers and patients," the analyst concluded.

Third, the data showed KD025 has clinical benefits "in corticosteroid and tacrolimus dose reductions and robust responses across organs," Fein wrote. "If approved, in our view, the real world setting could result in a greater level of compliance for KD025, and this could translate to greater penetration and maintenance."

Kadmon Holdings' management team plans further conversations with the FDA in H1/18 regarding the path to regulatory approval of KD025 in cGVHD, for which, Fein said, "the ibrutinib program provided a reachable development and regulatory goal posts."

Fein also noted that the recently reported KD025 results in cGVHD may have positive implications for the use of the therapeutic in idiopathic pulmonary fibrosis (IPF). Such a trial is now underway. The aim of trials in IPF is typically to prevent disease progression over time, with respiratory function as the likely primary endpoint.

To that end, the analyst explained, KD025 "was shown to improve lung function by decreasing collagen deposition in a multiorgan-system cGVHD model with bronchiolitis obliterans syndrome. Therefore, in our view, KD025 has potential to prevent fibrosis, and slow the decline of lung function." Also, KD025 may "induce the regression of already established fibrosis and thus improve overall lung function."

The initial data readout of Kadmon's Phase 2 IPF trial, anticipated in the next few months, "may offer a near-term inflection point," Fein said.

H.C. Wainwright has a Buy rating and a $25 per share price target on Kadmon, whose stock is currently trading at around $3.58 per share.

Disclosure:
1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following company mentioned in this article is a sponsor of Streetwise Reports: None. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.

Additional disclosures about the sources cited in this article

Disclosures from H.C. Wainwright & Co., Galectin Therapeutics, Target Price Revision, Dec. 7, 2017

I, Andrew S. Fein and Li Wang Watsek , certify that 1) all of the views expressed in this report accurately reflect my personal views about any and all subject securities or issuers discussed; and 2) no part of my compensation was, is, or will be directly or indirectly related to the specific recommendation or views expressed in this research report; and 3) neither myself nor any members of my household is an officer, director or advisory board member of these companies.

None of the research analysts or the research analyst’s household has a financial interest in the securities of Kadmon Holdings, Inc. (including, without limitation, any option, right, warrant, future, long or short position).

As of November 30, 2017 neither the Firm nor its affiliates beneficially own 1% or more of any class of common equity securities of Kadmon Holdings, Inc.

Neither the research analyst nor the Firm has any material conflict of interest in of which the research analyst knows or has reason to know at the time of publication of this research report.

The research analyst principally responsible for preparation of the report does not receive compensation that is based upon any specific investment banking services or transaction but is compensated based on factors including total revenue and profitability of the Firm, a substantial portion of which is derived from investment banking services.

The Firm or its affiliates did receive compensation from Kadmon Holdings, Inc. for investment banking services within twelve months before, and will seek compensation from the companies mentioned in this report for investment banking services within three months following publication of the research report.

H.C. Wainwright & Co., LLC managed or co-managed a public offering of securities for Kadmon Holdings, Inc. during the past 12 months.

The Firm does not make a market in Kadmon Holdings, Inc. as of the date of this research report.   

 

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