Early Clinical Data Released For Celgene's CELMoD

Following the release of clinical data from Celgene Corporation (NASDAQ: CELG)'s CELMoD pipeline, BMO Capital Markets said it believes near-term impact on the company's shares may be limited. However, the firm believes the pipeline optionality from 2020–2030 to be meaningful.

The firm's lead biotechnology analyst Ian Somaiya said promising early clinical results from the ongoing trials of CC-122 in DLBCL and CC-220 in Lupus vouch for its knowledge of Cereblon. The analyst expects the use of biomarker and PD data to drive efficacy.

Reviewing the clinical trial results, BMO Capital noted that CC-122 showed promise in Diffuse Large B-cell lymphoma, a cancer of a type of white blood cell, in an early stage trial, with 33 percent overall response rate and a six-month progression free survival of 26.9 percent. The firm believes CC-122 may become the CELMoD that is broadly developed across all NHL subtypes. BMO also noted that the company will present additional data at ASH 2016.

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Meanwhile, CC-220 demonstrated on-target effect in an ongoing mid-phase trial, the firm noted. The company also indicated that it would use CELMoDs or protein homesostasis beyond the traditional core areas of cancer and inflammatory diseases. BMO Capital believes it presents significant upside potential to its estimates, given that the programs have not been included in its model due to it being in early stages of development.

Despite CC-220's viability in treating myeloma, its success in an ongoing lupus trial has led the firm into believing that Celgene could use it as a back-up compound.

As such, BMO Capital maintains its Outperform rating on the shares of the company and the $141 price target.

At time of writing, Celgene shares were up 1.97 percent at $104.79.

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