BTIG starts ASLAN Pharma at buy; PT $16

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BTIG launched coverage of ASLAN Pharmaceuticals (NASDAQ:ASLN) with a “buy” rating and $16 price target. The stock closed at $6.85 on May 29.

Singapore-based ASLAN is engaged in the development and commercialization of innovative oncology therapeutics. It’s most significant asset, Varlitinib, is a promising, oral, reversible, pan-HER inhibitor that targets the human epidermal growth factor receptors that can cause uncontrolled growth, writes analyst Robert Hazlett.

With its pan-HER inhibition, Varlitinib is in multiple late-stage clinical trials in tumors that have increased HER activity, including biliary tract and gastric cancers, which also have a much higher prevalence in Asia, he added.

Mr. Hazlett said that with management’s Asian drug development and commercialization experience, ASLAN is driving the bulk of Varlitinib’s clinical development through Asia, an efficiency measure that aids development while still preserving the potential for orphan approval in other major markets worldwide.

“With pivotal readouts upcoming in biliary tract cancer for China in the second half of 2018 and the U.S. in 2019, and Phase 2 data in gastric cancer in the second half of 2018, Varlitinib could be launched in 2020,” he said. “We estimate global peak revenue of $1.3-billion in those indications.”

Mr. Hazlett said ASLAN also is developing, ASLAN003, an oral dihydroorotate dehydrogenase inhibitor in mid-stage development in AML, which “appears to have material promise in a large subset of AML patients, and a Phase 2 data readout in the second half of 2018.”

Stephen Kilmer