Cantor Fitzgerald launched coverage of vTv Therapeutics (NASDAQ:VTVT) with an “overweight” rating and 12-month price target of $5. The stock closed at 71 cents on Feb. 17.
vTv is developing novel orally administered drug candidates for the treatment of diabetes mellitus. Lead candidate, TTP399, is expected to begin in mid-2022 a pair of Phase 3 clinical trials as an adjunctive treatment to insulin for patients with Type 1 diabetes (T1D).
Analyst Charles Duncan, Ph.D., writes that the company previously established clinical proof-of-concept of TTP399 in its Phase 1b/2 SimpliciT1 study. “Another notable observation from the study [was] a meaningful reduction in hypoglycemic and hyperglycemic events in the TTP399 arm vs. placebo, key adverse events seen with other oral adjunctive treatments as well as insulin,” he said.
Dr. Duncan also said TTP399’s safety profile was bolstered by an insulin withdrawal study in which non-inferiority was demonstrated vs. placebo as measured by blood ketone levels.
“In all, this suggests to us that TTP399 may become the first safe and effective adjunctive treatment to insulin in T1D patients to be approved by the FDA,” he added.
Dr. Duncan suggested that a key factor suppressing vTv shares is that the company had about $19.6-million of cash on the balance sheet as of the third quarter of 2021, “which is not sufficient to support the Phase 3 studies.”
Noting that vTv is now headed by a former investment banker/venture capital investor, “once the overhang from the tenuous cash balance and potential dilution is removed, we believe investors will begin to take a closer look at the differentiated clinical profile of TTP399 and its potential in T1D,” Dr. Duncan said.
