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TICKERS: ANNX

Co. Advancing Drug Class With Broad Potential
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This developer of C1q-targeting therapeutics, with a catalyst-rich 18 months ahead, warrants analyst coverage, noted a BTIG report.

BTIG initiated coverage on Annexon Inc. (ANNX:NASDAQ) with a Buy rating and a $15 per share price target, reported analyst Dr. Thomas Shrader in a September 9, 2022 research note.

In comparison, the current share price of the biotech, developing new complement medicines for patients with classical complement-mediated disorders of the body, brain and eyes, is around $5.85.

The method of action of Annexon's therapeutics, inhibiting complement component 1q (C1q) of the classical complement cascade, "has broad potential," Shrader highlighted. The biotech is currently trialing five C1q-targeting drugs in eight indications and continues identifying indications and patient groups in which C1q intervention will have a meaningful impact.

Results from many of these studies are expected between now and year-end 2023, each readout acting as a potential stock-moving catalyst.

"Strongly validating clinical data indicating C1q modulation alters disease progression in essentially any of these programs should reflect on related programs and result in a significant value inflection," Shrader wrote.

The analyst explained that the C1q complement factor, which sets the complement cascade into motion, is overexpressed in multiple disease states. The complement cascade enhances the ability of antibodies and phagocytic cells to, in part, clear microbes and damaged cells from an organism. It also promotes inflammation.

Because ANX005 in Guillain-Barre syndrome is Annexon's lead overall program and lead autoimmune program, a positive readout "has the potential to support registration and opens the door to several other antibody-mediated autoimmune conditions," Shrader purported. Were efficacy to be shown in Guillain-Barre, it would derisk many other indications.

The early data are positive, showing the drug candidates greatly reduced C1q activity and inflammation and "support high target engagement," Shrader relayed. "Similarly, the greater clinical effects seen for patients with high complement activity (above average) relative to low activity seem a good start to proof of mechanism." Also, drug administration has been shown to be safe.

As for what is coming up for Annexon, catalysts include:

  • H2/22: Initial Phase 2 data for intravenous ANX005 in warm autoimmune hemolytic anemia  
  • H2/22: Initial Phase 1b data for subcutaneous ANX009 in lupus nephritis
  • 2023: Initial Phase 2/3 data for intravenous ANX005 in Guillain-Barre syndrome
  • 2023: Initial Phase 2a data for intravenous ANX005 for amyotrophic lateral sclerosis
  • 2023: Initial Phase 2 data for intravitreally injected ANX007 in geographic atrophy secondary to age-related macular degeneration

"The good news is that the data answering many of the key questions covering the role of C1q in various disease states is expected in the next 18 months," Shrader wrote.


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Disclosures For BTIG Research,  Annexon Inc., September 9, 2022

Analyst Certification:  I, Thomas Shrader, hereby certify that the views about the companies and securities discussed in this report are accurately expressed and that I have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this report.

I, Sung Jun Hong, hereby certify that the views about the companies and securities discussed in this report are accurately expressed and that I have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this report.

Company–Specific Regulatory Disclosures:  BTIG LLC expects to receive or intends to seek compensation for investment banking services in the next 3 months from:
Annexon, Inc. (ANNX) BTIG LLC expects to receive or intends to seek compensation for investment banking services in the next 3 months from: Alector Inc. (ALEC)

BTIG LLC expects to receive or intends to seek compensation for investment banking services in the next 3 months from: Biogen, Inc. (BIIB)

BTIG LLC expects to receive or intends to seek compensation for investment banking services in the next 3 months from: Denali Therapeutics Inc. (DNLI)

BTIG LLC expects to receive or intends to seek compensation for investment banking services in the next 3 months from: Silence Therapeutics (SLN)

BTIG LLC had an investment banking services client relationship during the past 12 months with: Silence Therapeutics (SLN)

BTIG LLC has received compensation for investment banking services in the past 12 months from: Silence Therapeutics (SLN)

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