Werewolf assumed Buy at Jefferies ahead of data for key cancer drug
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Jefferies issued a Buy rating on Werewolf Therapeutics (NASDAQ:HOWL) on Tuesday, citing an attractive valuation in the cancer-focused biotech ahead of a data readout scheduled in Q4 2023 for WTX-124, one of its lead candidates.
WTX-124 is a conditionally activated form of Interleukin-2 essential for immune-mediated cancer killing and stimulating innate and adaptive immune cells.
Assuming coverage on Werewolf (HOWL), the analyst Kambiz Yazdi argues that WTX-124 will retain efficacy as it is based on a contrarian 'alpha' IL-2 hypothesis as opposed to non-alpha IL-2 approaches followed by most IL-2 drug developers.
Yazdi, who raises the price target on HOWL to $12 from $11 per share, also opines that WTX-124 will be safe given its precise mechanism of action.
"We expect WTX-124 will retain full potency because it embraces a contrarian 'alpha' IL-2 hypothesis and will remain safe because it has been cleverly engineered to drop its payload only in the tumor microenvironment," the analyst added.
Yazdi sees a ~$800M probability adjusted sales for WTX-124 in metastatic melanoma ((mM)) and renal cell carcinoma ((mRCC)) where, according to him, the approval of synthetic interleukin-2 aldesleukin has validated the IL-2 use.