BTIG starts Synlogic at buy; PT $22

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BTIG launched coverage of Synlogic (NASDAQ:SYBX) with a “buy” rating and $22 price target. The stock closed at $9.56 on Feb. 12.

“We view Synlogic’s approach to correct inborn errors of metabolism via addition of key detoxification pathways in commensal bacteria as relatively straightforward relative to approaches at actual human gene correction or in vivo gene therapy,” writes analyst Thomas Shrader.

“A second positive is the use of E. coli Nissle as a gene introduction vector that is widely recognized as safe in humans [and] approved in the EU,” he added.

And a final positive in the Synlogic story is the expected release of important proof-of-concept data for both lead programs in phenylketonuria (PKU) and urea cycle disorders later this year, Mr. Shrader said. “Relative to many gene-correction approaches, we find the Synlogic logic persuasive.”

The company’s two lead therapeutic programs are being developed for the treatment of hepatic encephalopathy secondary to hyperammonemia and PKU. Top line Phase 1/2a data are expected for both of Synlogic’s lead product candidates, SYNB1020 and SYNB1618, in mid-2019, Mr. Shrader said.

Stephen Kilmer