Maxim Group launched coverage of Proteon Therapeutics (NASDAQ:PRTO) with a “buy” rating and a price target of $5. The stock closed at $1.71 on Oct. 29.
The company’s vonapanitase drug candidate is being evaluated in its second Phase 3 trial in hemodialysis fistula creation. The PATENCY-2 study is fully enrolled, with data expected in March 2019 and a potential BLA filling in the second half of 2019.
Analyst Jason McCarthy writes that the PATENCY-1 trial missed on the primary endpoint of primary unassisted patency in December 2016, but several other pre-specified endpoints were met on secondary patency and fistula use. “Any of these three could be a primary,” he added.
After meeting with FDA, the statistical plan for PATENCY-2 was amended to have secondary patency and fistula used as co-primaries. The study size also was doubled to 600 patients to ensure powering around the differences observed in PATENCY-1.
Mr. McCarthy said another positive signal from regulators comes from granting of breakthrough therapy designation for vonapanitase. “If the two co-primaries reach statistical significance in PATENCY-2, PATENCY-1 will be used as supporting data for a BLA,” he added.
Based on the protocol amendments in PATENCY-2, “we like the risk/reward scenario for a positive trial outcome and see Proteon shares with an attractive valuation ahead of the data,” Mr. McCarthy said.
