BTIG starts Graphite Bio at buy; PT $18

Graphite Bio

BTIG initiated coverage of Graphite Bio (NASDAQ:GRPH) with a “buy” rating and price target of $18. The stock closed at $4.15 on April 13.

“We believe Graphite Bio’s homology directed repair technology platform should support the development of genetic medicines with an improved risk/benefit profile vs. traditional approaches that either are prone to creating errors or have limited applicability,” writes analyst Yun Zhong, Ph.D.

Licensed from the company’s scientific founder’s lab at Stanford University, Dr. Zhong said the technology significantly reduces off-target effect while maintaining on-target efficiency, and all the components have been optimized to increase the overall genome editing efficiency. 

The lead candidate, GPH101, for the treatment of sickle cell disease has the potential to provide a “true cure based on the dual effect of restoring normal adult hemoglobin expression and eliminating sickle hemoglobin production, which we believe should be highly differentiated from competing programs,” he added. 

The opportunity for the gene insertion platform to precisely replace or insert a gene should be significant. Dr. Zhong said the encouraging preclinical data for X-linked severe combined immunodeficiency syndrome and Gaucher disease should support the development of prioritized indications of beta thalassemia and alpha-1 antitrypsin deficiency. 

“We see a favorable investment opportunity in Graphite shares, in the wake of an emerging biotech recovery.” Dr. Zhong said.