Stealth BioTherapeutics Corp MITO's lead drug elamipretide has “blockbuster potential” in primary mitochondrial dysfunction, or PMM, according to BMO Capital Markets.
The Analyst
BMO Capital Markets’ Matthew Luchini initiated coverage of Stealth BioTherapeutics with an Outperform rating and $29 price target.
The Thesis
Mitochondria, which are present in almost every cell in the body, are responsible for 90 percent of the body’s energy needs. Stealth is focused on primary mitochondrial diseases, which can be present at birth or have a later onset, Luchini said in a Tuesday note.
The company announced solid Phase 2 data in PMM and is scheduled to report Phase 3 data by the close of 2019, the analyst said.
The ongoing trial is “relatively de-risked,” and if the results are favorable, even a single Phase 3 study could support FDA approval, Luchini said.
PMM represents a large market opportunity of about $1.2 billion in peak sales given that there are about 190,000 patients in the U.S. and EU with no approved treatment, the analyst said.
Stealth is expected to commence a Phase 2 trial of elamipretide in geographic atrophy in the first quarter, with a data release possible by the end of 2020.
Price Action
Stealth BioTherapeutics shares were down 4.79 percent at $14.30 at the time of publication Tuesday.
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