Selecta Biosciences Inc. (SELB:NASDAQ) reported response rates from the two Phase 3 studies of its SEL-212 in chronic refractory gout, and they should support approval of the immunotherapeutic by the U.S. Food and Drug Administration, reported BTIG analyst Dr. Yun Zhong in a March 21 research note.
"We continue to believe that the size of the overall market as well as the low penetration rate by currently available therapy, should provide sufficient room for new treatment options," added Zhong.
Implied 492% Upside
Potential gains for Selecta investors are significant, given the sizable gap between the company's current share price of US$1.35 and BTIG's target price on it of US$8 per share.
Selecta is a Buy.
Platform Key to Success
Zhong wrote that SEL-212's response rate "appears to be consistent" and that BTIG believes the 56% rate experienced by the high-dose U.S. group "should reflect SEL-212's true efficacy." Along with statistically significant separation from placebo in terms of efficacy, SEL-212 exhibited a good safety profile.
SEL-212 is a combination of Selecta's ImmTOR immune tolerance platform and pegadricase, a therapeutic uricase enzyme.
"The Phase 3 gout data have provided strong evidence for ImmTOR's biological activity, and we believe the platform technology is what will support Selecta's proprietary programs and the company's long-term potential," Zhong commented. ImmTOR combines nanoparticle technology with rapamycin to generate antigen-specific immune tolerance.
Commercial Outlook for SEL-212 Positive
Zhong also highlighted that the commercial opportunity for SEL-212 "remains strong." Selecta's partner Sobi will be the one to launch the drug; its strategy and pricing for this are currently unknown.
While competitors are already on the market, Horizon Therapeutics' Krystexxa, for one, and Krystexxa plus methotrexate, for another, SEL-212 should differentiate itself because of its distinct advantages.
One benefit attractive to patients is Selecta's drug only needs to be administered once a month, whereas Krystexxa requires dosing every two weeks. Both drugs are given intravenously. Further, the Krystexxa-methotrexate combination can have undesirable side effects, such as gastrointestinal upset, while SEL-212 is well tolerated.
The ongoing commercialization of Krystexxa should not hinder, but rather help, the rollout of SEL-212, Zhong purported.
He wrote, "Even at the peak U.S. sales of over US$1.5 billion to which Horizon has guided for Krystexxa, the market penetration should be modest, so there will still be a significant opportunity for SEL-212."
|Want to be the first to know about interesting Biotechnology / Pharmaceuticals investment ideas? Sign up to receive the FREE Streetwise Reports' newsletter.||Subscribe|
1) Doresa Banning wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with: None. Please click here for more information.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.
6) This article does not constitute medical advice. Officers, employees and contributors to Streetwise Reports are not licensed medical professionals. Readers should always contact their healthcare professionals for medical advice.
Disclosures for BTIG Research, Selecta Biosciences, March 21, 2023
Analyst Certification: I, Yun Zhong, hereby certify that the views about the companies and securities discussed in this report are accurately expressed and that I have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this report.
Company–Specific Regulatory Disclosures: BTIG LLC expects to receive or intends to seek compensation for investment banking services in the next 3 months from: Selecta Biosciences (SELB)
General Disclosures: Research reports produced by BTIG LLC (“BTIG”) are published for and intended to be distributed solely to BTIG institutional and corporate clients. Recipients of BTIG reports will not be considered clients of BTIG solely because they may have received such BTIG report.
To the extent recipient accesses BTIG research, whether on a BTIG research website or through a third-party platform, BTIG is able to search, filter, download and review information on the readership of BTIG’s research, including the specific research consumed and the name, company name, email address and, in certain circumstances, the location of the individual who accessed the research (the “Readership Information”). Recipient consents to BTIG’s receipt of the Readership Information, including receipt of that information from a third party.
The research analyst(s) responsible for the preparation of this report receives compensation based upon a variety of factors, including the quality and accuracy of research, internal/client feedback, and overall Firm revenues. BTIG reports are based on public information and BTIG considers the same to be reliable, comprehensive information, but makes no representation or warranty that the reports are accurate or complete. BTIG opinions and information provided in this report are as of the date of the report and may change without notice. An issuer may be classified as “Under Review” or “Research Restricted”. In these cases, investors should consider any previous investment recommendation and/or rating to a subject company/issuer to no longer be current and should not be relied upon nor considered a solicitation.
This research report is not an offer to buy or sell or solicitation of an offer to buy or sell any security in any jurisdiction where such an offer or solicitation would be illegal. This research report was not drafted specifically for any particular individual or entity and is not a personal recommendation to participate in any particular trading strategy or transaction. Any recipient of this research report should obtain independent advice specific to their personal circumstances before undertaking any investment activity and must make their own independent evaluation of any securities or financial instruments.
Facts, views or opinions presented in this report have not been reviewed by, and may not reflect information known to, employees or other professionals in the “BTIG Group” (BTIG Group includes, but is not limited to, BTIG and its parents, subsidiaries and/ or affiliates). BTIG Group employees, including Sales Representatives and Traders, may provide oral or written commentary or advice that may be inconsistent with the opinions and/or views expressed in this research report. BTIG Group employees and/or its affiliates not involved in the preparation of this research report may have investments in securities or derivatives of securities of companies mentioned in this report that are inconsistent with the views discussed in this report.
Investors in securities products bear certain risks in conjunction with those investments. The value of, and income from, any investments may vary because of changes in interest rates or foreign exchange rates, securities prices or market indexes, operational or financial conditions of companies or other factors within or beyond the companies’ control. Recipient of the research reports should be aware that investments in securities may pose significant risks due to the inherent uncertainty associated with relying on forecasts of various factors that can affect the earnings, cash flow and overall valuation of a company.
Any investment in securities should be undertaken only upon consideration of issues relating to the recipient’s overall investment portfolio and objectives (such as diversification by asset class, industry or company) as well as time horizon and liquidity needs. Further, past performance should not be taken as an indication or guarantee of future performance, and no representation or warranty, express or implied, is made regarding future performance. There may be time limitations on the exercise of options or other rights in any securities transactions.
Investing in foreign markets and securities, including ADRs, is subject to additional risks such as currency fluctuation, limited information, political instability, economic risk, and the potential for illiquid markets. Investing in emerging markets may accentuate these risks. Non-U.S. reporting issuers of foreign securities, however, may not make regular or complete public disclosure relating to their financial condition or the securities that they issue. The trademarks and service marks contained herein are the property of their respective owners. Third-party data providers make no warranties or representations of any kind relating to the accuracy, completeness, or timeliness of the data they provide and shall not have liability of any damages of any kind relating to such data. The report or any portion hereof may not be reprinted, sold or redistributed without the written consent of BTIG. This report is intended only for use by the recipient. The recipient acknowledges that all research and analysis in this report are the property of BTIG and agrees to limit the use of all publications received from BTIG within his, or her or its, own company or organization. No rights are given for passing on, transmitting, re transmitting or reselling the information provided.
Jurisdiction and Dissemination: BTIG is a U.S. broker-dealer and member of FINRA and SIPC. BTIG Australia Limited ACN 128 554 601, member of ASIC and ASX; BTIG Hong Kong Limited, an Exchange Participant of SEHK and licensed and regulated by the SFC; BTIG Ltd, member of the LSE, authorized and regulated by the FSA; and BTIG Singapore Pte Ltd, registered and licensed with MAS; are all separate but affiliated entities of BTIG. Unless governing law permits otherwise, you must contact a BTIG entity in your home jurisdiction for further information, or if you want to use our services in effecting a transaction. Issued and approved for distribution in the UK and EEA by BTIG Ltd. to eligible counterparties and professional clients only. Issued and distributed in Australia to “wholesale clients” only by BTIG Australia Limited. In Singapore and Hong Kong, further information may be obtained from BTIG Singapore Pte Ltd and BTIG Hong Kong Limited, respectively.