Arcellx's Lead Asset Can Potentially Outperform Bristol-Myers Squibb, Johnson & Johnson's Multiple Myeloma Cell Therapies: Morgan Stanley

Zinger Key Points
  • If Arcellx's ddBCMA is successful, it could secure US approval for late-line multiple myeloma by 2026, potentially capturing ~46% of market.
  • Morgan Stanley analysts model around $5 billion in unadjusted global peak ddBCMA sales across multiple treatment lines.

Morgan Stanley initiates Arcellx Inc ACLX, noting a differentiated CAR-T platform for blood cancer backed by an established CAR-T partner.

ddBCMA (aka anito-cel) is Arcellx’s lead asset, incorporating its patent-protected D-domain as the extracellular binding domain. 

Also Read: Blood Cancer Player Arcellx Finds Place On Analyst Conviction List – Potential Room For Growth In 2024.

The domain’s differentiated design confers several advantages, including high transduction efficiency and stability, which drives a potential best-in-class profile and scalable manufacturability. 

Morgan Stanley analysts model around $5 billion in unadjusted global peak ddBCMA sales across multiple treatment lines (vs. unadjusted global peak sales of around $8 billion for Carvykti per VA consensus) with a program blended probability of success (PoS) of 60% (higher in late-line, lower in earlier-line).

Carvykti (ciltacabtagene autoleucel) is marketed in collaboration between Johnson & Johnson JNJ and Legend Biotech Inc LEGN.

Morgan Stanley initiates Arcellx with an Overweight rating with a price target of $81.

If ddBCMA proves successful, it could secure approval in the United States for late-line multiple myeloma by 2026, potentially capturing up to 46% of the market. 

The promising Phase 2 data suggests that ddBCMA’s safety and efficacy profile is superior, positioning it to outperform Bristol-Myers Squibb Co BMY and 2Seventy Bio Inc’s TSVT Abecma (idecabtagene vicleucel) and compete effectively with Carvykti. 

Collaborating with Gilead Sciences Inc GILD is expected to provide Arcellx with valuable expertise in CAR-T cell manufacturing, helping avoid the manufacturing challenges that hindered Carvykti’s market reach.

In December 2023, Arcellx announced new data from its Phase 1 expansion study of CART-ddBCMA for relapsed and/or refractory multiple myeloma

The interim anito-cel Phase 1 clinical results (October 15, 2023 cutoff date) demonstrate deep and durable responses.

Price Action: ACLX shares are down 2.08% at $71.43 on the last check Thursday.

Photo by Christina Victoria Craft on Unsplash

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