UPDATE: Wedbush Initiates Coverage on Stemline Therapeutics with Outperform Rating, $49 PT on Strong SL-401 Potential

In a report published Thursday, Wedbush analyst David M. Nierengarten initiated coverage on

with an Outperform rating and $49.00 price target. In the report, Wedbush noted, “Stemline Therapeutics is a biotechnology company that is developing novel oncology treatments that target cancer stem cells (CSCs) and tumor bulk. Its lead clinical candidate, SL-401, is a targeted, truncated diphtheria toxin, set to begin a pivotal Phase II trial for the treatment of relapsed or refractory blastic plasmacytoid dendritic cell neoplasm (BPDCN), a rare hematologic cancer. In addition, we expect SL-401 to enter a pivotal Phase II trial as a third-line treatment for acute myeloid leukemia (AML). We note that SL-401 targets interleukin-3 receptor (IL-3R), which is expressed on a variety of hematologic cancers, including multiple myeloma, myelodysplastic syndrome (MDS), and other forms of leukemias, and we expect some use in these other indications upon initial approval for BPDCN. The company is also developing SL-701, a peptide-based cancer vaccine, which could enter Phase IIb studies in pediatric patients with malignant glioma and adult patients with recurrent or refractory glioblastoma multiforme (GBM) in 2014. STML's proprietary drug discovery platform, StemScreen, isolates and analyzes CSCs along with identifying compounds that target them. We believe the market is undervaluing these assets, and estimate that STML could generate $776 million in product sales by 2019, our valuation year.” Stemline Therapeutics closed on Wednesday at $36.48.