BTIG launched coverage of Cellectis SA (NASDAQ:CLLS; Euronext Growth:ALCLS) with a “buy” rating and $37 price target. The stock closed at $13.86 on Aug. 8.
“Despite the initial positive reaction from investors to Cellectis’ agreements with Servier Laboratories of France and Pfizer, the company’s value has steadily declined since mid-2015,” writes analyst Amanda Murphy.
This decline may have been at least partially driven by the perception that Cellectis “gave away” its allo CAR-T pipeline, she added.
However, she said that through its partnership and collaboration agreements, Cellectis is entitled to meaningful milestone and royalty payments, including up to $350-million in pre-commercial milestone payments for the first anti-CD19 product candidate that comes to market, either UCART19 or ALLO-501, as part of its relationship with Allogene Therapeutics and Servier.
The company also is entitled to royalty payments equal to 9% of treatment revenue for each product candidate Allogene develops using Cellectis’ TALEN gene editing technology. She said total milestone and royalty payments account for approximately $16, or roughly 45%, of her price target.
In addition, Ms. Murphy suggested Cellectis gets little credit for its wholly owned allogeneic CAR-T programs. “This is somewhat understandable given the company faced a clinical hold for its lead candidate and has encountered manufacturing delays because of a supplier issue.”
Nevertheless, “we see some value to these programs that should be considered. Cellectis now has thousands of GMP grade doses of its three proprietary products manufactured and stored, enough for dose expansion phases, which de-risks the potential of future manufacturing issues,” she added.
