Analysts downgrade ImmunoGen after failed Phase 3 trial

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Analysts at SVB Leerink and H.C. Wainwright downgraded Immunogen (NASDAQ:IMGN) and lowered their price targets after the company’s FORWARD-I Phase 3 trial with mirvetuximab soravtansine did not meet its primary endpoint in platinum-resistant ovarian cancer.

Shares of Immunogen dropped $2.21, or 47%, to $2.51 in heavier than normal trading on March 1.

“The results are disappointing versus our expectation that the FORWARD-I study would be positive, although there were certainly valid concerns from investors and significant downside risk to the stock if the study failed,” writes Leerink analyst Jonathan Chang.

He downgraded the stock to“market perform” from “outperform” and slashed its price target to $3 from $15

He said Immunogen is still evaluating mirvetuximab in various combination cohorts in the Phase 1/2 FORWARD-II study, with a company update expected in 2019.

“We view the apparent lack of benefit in the primary endpoint of progression free survival in the intent-to-treat population as a poor signal of activity and have removed both the monotherapy and combination opportunities from our model,” Mr. Chang said.

Analyst Debjit Chattopadhyay of HCW downgraded ImmunoGen to “neutral” from “buy” and cut his price target to $3.50 from $18.

Post FORWARD-I, “mirvetuximab is clearly not DOA with ImmunoGen expected to deliver mature data from its mirvetuximab-based doublet and triplet programs, but the Street is likely to discount observations from single arm studies, given the significant compression in overall response rate in the FORWARD-I program,” he said. “The remainder of the pipeline remains early, or partnered and likely to face significant competition, in our view.”

Sydney Stewart