Analyst: CytomX Therapeutics Validated By AbbVie Decision

AbbVie Inc ABBV has selected a second target under an existing collaboration with CytomX Therapeutics Inc CTMX for probody technology.

This development is “incrementally positive” for CytomX Therapeutics and validates its probody technology and commercial potential, according to Mizuho Securities.

The Analyst

Mara Goldstein maintained a Buy rating on CytomX Therapeutics with an unchanged $16 price target.

The Thesis

AbbVie’s selection of a second target has triggered a payment of $10 million, Goldstein said in the Tuesday note. (See her track record here.)

AbbVie is in a collaboration with CytomX Therapeutics to jointly develop and commercialize CX-2029, an anti-CD71 probody drug conjugate.

AbbVie received exclusive worldwide rights to develop and commercialize PDCs against a maximum of two additional targets.

The first of these two targets was selected in March 2017, and AbbVie has now picked the second one, although the targets remain undisclosed, the analyst said.

CytomX Therapeutics is eligible to receive as much as $275 million in milestones and royalties on each of the two additional targets.

Mizuho expects CytomX Therapeutics to provide visibility into its wholly owned programs later in 2019 and into 2020, which could remove overhangs on its key programs, including CX-072 and CX-2009.

The company had cash of around $396 million as of the first quarter, Goldstein said.