FBR Upgrades Kite Pharma, Sees 35% Upside

• Kite Pharma Inc KITE shares have lost 16 percent since October 20.
• FBR & Co’s Ed White upgraded the rating for the company from Market Perform to Outperform, while raising the price target from $72 to $75.
• Kite Pharma’s impressive performance in 2015 could continue in 2016, White stated.

Kite Pharma made significant progress in 2015, and could continue to do so in 2016, given a number of potential meaningful milestones, including interim data from the pivotal Phase II ZUMA-1 trial, which could support filing of a BLA with the FDA, analyst Ed White said.

Kite Pharma has entered into a research and licensing agreement with Leiden Medical University Center [LUMC] for the development of TCR candidates targeting solid tumors associated with HPV type 16 infection, and has also entered into an expanded CRADA with the NCI for the development of fully human anti-CD19 CAR targeting B-cell lymphomas and leukemias.

A meeting with Kite Pharma management in San Francisco indicated that the company also plans to launch two clinical trials in the first half of 2016 of new product candidates, including a fully human anti-CD19 CAR targeting hematologic malignancies and a TCR product targeting KRAS mutation tumors, as well as launching European versions of the ZUMA trials, White mentioned.

“Kite CEO Arie Belldegrun presented updated data from 41 patients in a trial conducted at the NCI, including data from patients treated with Kite’s manufacturing process. Importantly, eight patients converted from PR in their initial response to CR best response, and 21 of 22 patients with CR remain in remission as of November 30, 2015…The therapy, as expected, showed generally reversible Grade III-IV AEs, including CRS and neurotoxicity,” the analyst wrote.