Leerink Just Went Bullish On Aduro Biotech, Cidara Therapeutics

Leerink analysts have initiated coverage of two biotechnology companies with an Outperform rating. The price target for

is set at $48, while that for

is set for $24. Aduro BioTech's management comprises of leaders in the field of cancer vaccines, while the company's Listeria platform is considered as the most sophisticated in the industry. In the report Leerink noted, "Although the role of cancer vaccines remains controversial, we believe several lines of evidence argue for the need for generating anti-tumor immune response, and these include the lack of tumor infiltrating lymphocytes in approximately half of melanoma and lung cancers despite relatively high mutation loads, the success of adoptively transferred T cells, and the recent data demonstrating the association of genomic mutations and neoantigens with efficacy of checkpoint inhibitors." Aduro BioTech's lead LADD product CRS-207 has "demonstrated proof of principle in a randomized Phase II study in pancreatic cancer, resulting in the breakthrough designation by the FDA." While the scheduled ECLIPSE Phase IIb readout could be a binary event, the analysts believe that "the risk / reward is favorable as positive results could validate the platform broadly due to efficacy in a difficult tumor type and may even advance CRS-207 toward an accelerated approval." In case the result is negative, there would be interest in CRS-207 / Opdivo combination data in the back half of 2016. In a separate report related to Cidara Therapeutics, Leerink noted, "We believe lead product CD101 has the potential to be a best-in-class anti-fungal agent, benefitting from multiple points of differentiation including (1) increased potency and (2) a longer half life, which may enable once-weekly dosing and earlier hospital discharge. Long term we believe CDTX's "Cloudbreak" platform could represent a significant source of upside - lead Cloudbreak candidates C001 and C016 operate via a novel, scientifically compelling mechanism of-action which could be applicable to many types of (not just fungal) serious infections." "CD101 is a novel echinocandin with a higher Cmax and a much longer-half life, which we believe could translate into higher cure rates, increased convenience, and in some cases, shorter hospital stays…Similar to '101 IV, CDTX's topical formulation of CD101 has shown superior in vitro potency to standard-of-care azoles, which we believe holds the potential to translate into better outcomes for patients with Recurrent Vulvovaginal Candidiasis (RVVC)," the analysts added.