Citigroup Upgrades Bellicum Pharma, Sees Clearer Pathway For BPX-501 Approval

Citigroup upgraded Bellicum Pharmaceuticals Inc BLCM to Buy and more than doubled its target price to $24 as it sees clearer pathway for the approval of BPX-501, a T-cell therapy that could increase transplant success and reduce side effects like infection.

The company is in clinical development with BPX-501 in orphan blood disease and cancer patients.

Last week, the European Commission granted orphan drug designations for both its lead T-cell therapy product candidate BPX-501 to treat hematopoietic stem cell transplantation (HSCT), and for activator agent rimiducid for the treatment of Graft vs. Host Disease (GvHD).

Based on regulatory discussions, Bellicum believes data from the European arm of its BP-004 trial, with a six-month follow-up time and expanded to enroll additional patients, could form the basis of Marketing Authorization Applications for BPX-501 and rimiducid.

Since the EU pathway for BPX-501 is getting clear, Citi said the FDA pathway could come by end of the year.

"These developments increase our confidence in BPX-501 program and this coupled with 2 new trials for CAR-T/TCR programs bring us close to data in less competitive cancer indications. While we suspect uptake in leukemia would still require longer follow-up (than 6 months), we think early EU filing is positive," analyst Robyn Karnauskas wrote in a note.

The analyst sees multiple stock moving catalysts in next 12-18 months including "1) updated BPX-501 data at ASH'16, 2) clarity on FDA approval pathway by Q4'16, 3) CAR-T/TCR data potentially in 2017. A partnership deal for CaspaCIDe safety switch could be further upside."

Bellicum has initiated two new clinical trials: BPX-601 in pancreatic cancer and BPX-701 in AML/MDS. Data from these programs over next 12-18 months could provide upside.

Further, Karnauskas raised his probability of BPX-501 revenues in non-malignant patients to 75 percent from 70 percent and malignant patients to 20 percent from 5 percent.