Stifel starts Eliem Therapeutics at buy; PT $35

Stifel launched coverage of Eliem Therapeutics (NASDAQ:ELYM) with a “buy” rating and price target of $35. The stock closed at $27.56 on Sept. 3.

Eliem is a clinical-stage biotechnology company focused on developing novel therapies for neuronal excitability disorders to address unmet needs in chronic pain, psychiatry, epilepsy and other disorders of the peripheral and central nervous systems. 

Its lead drug candidate in pain, ETX-810, is a pro-drug of the supplement PEA, which has been shown to have “analgesic properties and a non-opioid mechanism across multiple clinical studies,” writes analyst Paul Matteis. 

He said ETX-810 is a compound with improved drug-like properties, and Eliem’s two Phase 2 studies are expected to read-out in the first half of 2022. 

Eliem’s ETX-155 candidate is in development for major depressive disorder(MDD)/epilepsy. “While we won’t get MDD data until 2023, Eliem has the opportunity to learn from first-mover competitors … and potentially differentiate on dosing/positioning,” Mr. Matteis said. 

In the meantime, ETX-155 proof-of-principle epilepsy data coming in the first half of 2022 has read-through for anti-seizure effect and the molecule broadly, he added.