BioTuesdays

SVB Leerink cuts Atea Pharma PT to $20 from $60

Atea Pharmaceuticals

SVB Leerink slashed its price target for Atea Pharmaceuticals (NASDAQ:AVIR) to $20 from $60 but maintained its “outperform” rating after the company’s Phase 2 MOONSONG trial in COVID-19 outpatients did not hit its primary endpoint on viral load reduction, compared with placebo.

On Oct. 19, shares of Atea tumbled $26.70 to close at $13.82 on heavier than normal volume of 129 million shares.

“Atea is now considering modifications to the ongoing Phase 3 MORNINGSKY trial, which would delay that readout by a year to the second half of 2022,” writes analyst Roanna Ruiz, Ph.D.

She said that while the results suggest a longer development path and a GI safety signal for AT-527, “we still think the stock looks interesting at these levels as we believe near-term updates in the COVID-19 space and/or on behalf of Atea should bring more clarity (and, possible upside) to the story.”

In addition, Dr. Ruiz said the prespecified analysis from MOONSONG and prior Phase 2 hospitalized COVID-19 patient data indicate AT-527 has a “real efficacy signal, which leads us to believe today’s setback may skew more towards a trial design issue (possible to address) rather than a drug molecule issue (harder to address).”

Sign up for the BioTuesdays weekly newsletter

Get the latest news on the healthcare industry’s corporate and clinical developments, executive moves, and market updates. Every Tuesday, in your inbox.