Nierengarten initiated coverage of Nightstar Therapeutics Plc (NITE:NASDAQ) with an Outperform rating and $29 per share 12-month price target, according to an Oct. 23 research report. This clinical-stage, London-based biopharmaceutical firm "is developing gene therapies for the treatment of rare ophthalmic conditions."
Nightstar has two clinical assets. One is NSR-REP1, a treatment for choroideremia (CHM), a rare genetic retinal disease for which there are "no other approved therapies," Nierengarten indicated. The therapy is "set to enter a Phase 3 registrational trial in H1/18 in 140 CHM patients," with one-year follow-up data anticipated in 2020. "Continued clinical success of lead candidate NSR-REP1 in CHM" is the primary value driver of Nightstar.
As for the mechanism of action, the analyst added that NSR-REP1 "works by restoring endogenous, wild-type production of the genetically defunct REP1 protein. This offers curative potential by halting the disease progression or improving visual function in patients who would otherwise invariably go blind."
The second clinical candidate, NSR-RPGR, "provides appreciable upside to our valuation," Nierengarten wrote. It is a treatment for X-linked retinitis pigmentosa (XLRP), another inherited retinal disease. The therapy is currently in a "Phase 1/2 dose-ranging trial (XIRIUS) with targeted enrollment of 24 XLRP patients and preliminary data expected in 2018." In the case of NSR-RPGR, it induces production of the "genetically defunct RPGR protein," which, left untreated, would result in blindness.
Nightstar also has a lead preclinical candidate, NSR-BEST1, which is a therapeutic for another genetic eye condition called Best disease.
The gene therapy firm has the advantages of "worldwide market exclusivity and large development leads over competition," Nierengarten purported. "The company retains worldwide rights to all its product candidates. NSR-REP1 for CHM is approximately two years ahead of second-in-class candidate SPK-7001 while NSR-RPGR for XLRP is about six months ahead of second-in-class candidate A004." NSR-BEST1 is "the only such disclosed candidate in development."
As for the significance of potential firsts for Nightstar, Nierengarten said that "first-in-class status is critical for gene therapy products, where a single injection has curative potential. Also, since all product candidates target rare diseases, the first-to-market advantage is amplified."
Wedbush derived its $29 per share price target "based on an eight multiple of projected U.S. and EU5 sales for NSR-REP1 in 2024 and NSR-RPGR in 2026 in newly diagnosed patients, plus the net present value of sales in existing patients," wrote Nierengarten. Nightstar's stock is currently trading at around $18.75 per share.
Want to read more Life Sciences Report articles like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see recent articles and interviews with industry analysts and commentators, visit our Streetwise Interviews page.
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.
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.
Disclosures from Wedbush, Nightstar Therapeutics, Company Report, Oct. 23, 2017
Analyst Certification: We, David Nierengarten, Robert Driscoll and Dilip Joseph, certify that the views expressed in this report accurately reflect our personal opinions and that we have not and will not, directly or indirectly, receive compensation or other payments in connection with our specific recommendations or views contained in this report.
The analysts responsible for preparing research reports do not receive compensation based on specific investment banking activity.
The analysts receive compensation that is based upon various factors including WS' total revenues, a portion of which are generated
by WS' investment banking activities.
Company Specific Disclosures
1. WS makes a market in the securities of Nightstar Therapeutics, Applied Genetic Technologies and Spark Therapeutics.
3. WS co-managed a public offering of securities for Nightstar Therapeutics within the last 12 months.
5. WS provided Nightstar Therapeutics with investment banking services within the last 12 months.
7. WS expects to receive compensation for investment banking services from Nightstar Therapeutics within the next 3 months.