Disappointment In Corvus Pharma Understandable, But Selloff May Have Been Overdone

Corvus Pharmaceuticals Inc CRVS nearly half its value Tuesday following the release of interim results of its Phase 1 study of CPI-444, designed to treat patients with advanced cancers.

Cantor Fitzgerald believes the selloff is understandable, but feel it has been overdone. The firm maintains an Overweight rating and $25 price target on Corvus.

“While we understand where the disappointment stems from, we think the reaction in the share price is perhaps not fully reflective of what was presented at AACR. We think additional data releases (ASCO) could help to refocus investor,” analyst Mara Goldstein said.

Shares ran up nearly 50 percent earlier this year, believed to be due to increased interest in Adenosine A2A receptor as a potential checkpoint therapy, specifically how it pertains to CPI-444.

“We don’t think the CPI-444 data are bad, just perhaps below where expectations were trending ahead of the meeting,” Goldstein said.

In the interim data on 96 patients, the objective response rate was 38 percent, 56 percent of patients were resistant to treatment with PD-LI antibodies and had ORRs of 30 percent for monotherapy and 46 percent for combination.

“We yield that investors are going to need to some convince from this point. The data generated in cohorts that are intended for accelerated registration look interesting to us, and we think that additional data as ASCO on these cohorts could help reset expectations,” Goldstein said.

Corvus Pharmaceuticals closed down 2.5 percent at $10.10.