HCW ups Mersana Therapeutics PT to $23 from $16


H.C. Wainwright raised its price target for Mersana Therapeutics (NASDAQ:MRSN) to $23 from $16 after the company disclosed plans to reinstate dosing of new patients following the FDA decision to lift the partial clinical hold on XMT-1522.

Shares of Mersana were quoted at $10.92, down $3.46, or 24%, in afternoon trading on Sept. 17.

Mersana’s lead product candidate, XMT-1522, is in development for patients with advanced tumors expressing HER2, including breast cancer, non-small-cell-lung-cancer and gastric cancer patients.

“While this is welcome news, it does come with a few caveats, including the increased monitoring of patients; exclusion of patients with advanced hepatic impairment; and every four-week dosing schedule,” writes analyst Debjit Chattopadhyay.

“Furthermore, prior to the clinical hold, patients were dosed at the eighth cohort, roughly 37 mg/m2, but Mersana is planning to restart dosing at cohort 6, at approximately 21.3 mg/m2 and hence, the program is not entirely out of the woods,” he added.

Mr. Chattopadhyay said the sell-off on the news could be potentially related to the step back, which “pushes relevant comparisons with peer sponsored programs into mid-2019, by our estimates.”

The higher price target, Mr. Chattopadhyay said, is a reflection of the XMT-1522 clinical program “with modest probabilities of success addressed in the valuation segment.”

Stephen Kilmer