SVB Leerink starts Fate Therapeutics at OP; PT $20

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SVB Leerink launched coverage of Fate Therapeutics (NASDAQ:FATE) with an “outperform” rating and $20 price target. The stock closed at $16.71 on March 27.

Analyst Daina Graybosch writes that Fate is at the forefront of developing cancer therapies using induced pluripotent stem cells (iPSC), a potentially safer, scalable platform for producing homogeneous cell therapies that can be delivered off-the-shelf.

“IND clearance from the FDA for two Fate iPSC was a landmark achievement that has attracted new investors into the stock,” she added.

Ms. Graybosch sees the most value in Fate’s leading iPSC natural killer (NK) cell therapies: FT500, which is optimized to support adaptive T-cell immunity with potential in combination with anti-PD(L)1 after failure of checkpoint inhibitors; and FT516, which could extend the breadth and effectiveness of antibody-dependent cellular cytotoxicity.

“Fate has a large and growing pipeline of iPSC allogeneic NK and T-cell therapies with differentiated function, which will enter the clinic in the next year,” she added.

Stephen Kilmer