Ladenburg starts Forte Biosciences at buy; PT $60

Ladenburg Thalmann launched coverage of Forte Biosciences (NASDAQ:FBRX) with a “buy” rating and $60 price target. The stock closed at $14.31 on June 19.

Forte is focused on the treatment of inflammatory skin diseases, particularly atopic dermatitis. Its lead drug candidate, FB-401, is a spray, which “we believe will become preferred over the gels that atopic dermatitis patients spread on daily,” writes analyst Michael Higgins. 

FB-401 is a topical mixture comprised primarily of three strains of the commensal skin bacteria, Roseomonas mucans. It was licensed from the Department of Health and Human Services, with initial development work completed by the NIH. 

In a Phase 1/2a study in 20 adults and 10 children, Mr. Higgins said available data from the first 15 patients showed statistically significant improvements in the SCORing atopic dermatitis scale, along with a decreased need for application of topical corticosteroids and the incidence of pruritis. Remaining data is expected to be published this summer.

Forte is set to begin enrolling a 16-week Phase 2 trial this summer in 124 mild-to-moderate atopic dermatitis patients randomized into a two-arm, placebo-controlled trial, with topline data expected in mid-2021. If successful, a 500-patient Phase 3 trial would begin around the end of 2021. 

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