Market Overview

Stifel Doubles Down On MEI Pharma, Considers ME-401 'Best-In-Class'

Share:
Stifel Doubles Down On MEI Pharma, Considers ME-401 'Best-In-Class'
Related MEIP
The Daily Biotech Pulse: FDA Blessings for Merck's HIV Drug Combo, Veracyte's Test Gets Medicare Coverage
26 Stocks Moving In Friday's Pre-Market Session

MEI Pharma Inc (NASDAQ: MEIP) is down 31.5 percent from its one-year high struck after the release of preliminary data for ME-401.

Stifel Nicolaus considers the decline a stake-building opportunity.

The Analyst 

Analyst Stephen Willey upgraded MEI from Hold to Buy and raised the price target from $2.50 to $7.

The Thesis

ME-401 justifies a bullish stance, Willey said: the candidate demonstrated a 90-percent overall response rate in patients with relapsed or refractory B-cell non-Hodgkin lymphomas. (See Willey's track record here.) 

“We believe year-end 2018 updated Phase 1B ME-401 data is likely to solidify ME-401 as a best-in-class compound and believe the planned year-end 2018 initiation of a pivotal single-arm/monotherapy trial in third-line follicular lymphoma should provide a clear runway to commercialization with minimal underlying development/regulatory risk,” the analyst said. 

The drug is considered a market share threat to existing rivals, including Gilead Sciences, Inc. (NASDAQ: GILD)’s Zydelig/idelalisib or Bayer’s Aliqopa/copanlisib. Stifel estimates peak U.S. sales in R/R FL beyond $300 million, which would contribute $5 per share in discounted cash flow.

At the same time, MEI’s CDK9 inhibitor voruciclib is a source of long-term optionality in potential combination therapies with venetoclax, Willey said. 

Stifel is less optimistic for pracinostat in acute myeloid leukemia and myelodysplastic syndromes, but considers the drug less critical to MEI’s story. Encouraging data could nonetheless drive upside, the analyst said. 

Price Action

MEI Pharma shares were trading up 5.41 percent to $3.70 at the time of publication Friday morning. 

Related Links:

GlaxoSmithKline, 23andMe Partner On DNA Data In Drug Development

With Positive Phase 2b Results In Hand, resTORbio CEO Sees Path To 2020 NDA

Latest Ratings for MEIP

DateFirmActionFromTo
Jul 2018Stifel NicolausUpgradesHoldBuy
Jul 2018SunTrust Robinson HumphreyInitiates Coverage OnBuy
Jun 2018Wells FargoUpgradesMarket PerformOutperform

View More Analyst Ratings for MEIP
View the Latest Analyst Ratings

Posted-In: Stephen Willey Stifel NicolausAnalyst Color Biotech Upgrades Price Target Analyst Ratings General Best of Benzinga

 

Related Articles (GILD + MEIP)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
ETTXWedbushInitiates Coverage On19.0
WINGWedbushDowngrades0.0
BMYCitigroupDowngrades57.0
INTCNomuraUpgrades0.0
HRZNKeefe Bruyette & WoodsDowngrades10.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

Juniper's Cloud 'Stall' Prompts BMO Downgrade

Mid-Morning Market Update: Markets Mostly Lower; Twitter Shares Fall Following Q2 Results