SVB Leerink starts Cullinan at OP; PT $52

SVB Leerink initiated coverage of Cullinan Management (NASDAQ:CGEM) with an “outperform” rating and $52 price target. The stock closed at $33.77 on Feb. 1.

Cullinan is leveraging a unique “Hub-and-Spoke” approach to cultivate seven assets in different stages of development, across a number of treatment modalities like small molecules, bispecific antibodies, immuno-oncology agents, and cell therapy interventions.

“This business model enables a more efficient capital allocation to support go/no-go decisions as the programs progress,” writes analyst Andrew Berens, M.D.

“This streamlined, pragmatic approach translates to the company’s financial statements, which suggest much more efficient operations than is typical with a company supporting a portfolio of Cullinan’s size, and we forecast less reliance on the capital markets to fund operations, as well as rapidly growing profitability once the company becomes a commercial-stage company,” he added.

The company’s lead asset, CLN-081, is an epidermal growth factor receptor (EGFR) exon 20 insertion mutation inhibitor that is currently in Phase 1/2a clinical development for the treatment of non-small cell lung cancer. “Based on promising dose ranging data, CLN-081 is highly active, appears to have a differentiated safety/tolerability profile, and could be a best-in-class EGFR ex20 mutation inhibitor,” Dr. Berens said.

The second lead asset, CLN-049, is a bispecific antibody targeting FLT3 for AML patients. “Cullinan also has multiple early assets that we think will further diversity the pipeline and generate additional fundamental value for shareholders,” he added.

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