Cantor starts Connect Biopharma at OW; PT $5


Cantor Fitzgerald initiated coverage of Connect Biopharma (NASDAQ:CNTB) with an “overweight” rating and a discounted cash flow-based price target of $5. The stock closed at 75 cents on June 1.

“We think that Connect’s pipeline is underappreciated and that upward earnings-estimate revisions will drive the stock higher, writes analyst Louise Chen. “We believe that the improved outlook could come from pipeline advancements and/or partnerships for Connect’s assets,” she added. 

Ms. Chen said Connect is well capitalized, with an estimated cash runway into at least the second half of 2023, which would take the company through the topline data readouts for CBP-201 in a pivotal China trial in atopic dermatitis and a global Phase 2 trial in asthma, both guided to the first half of 2023.

CBP-201 is an anti-IL-4Ra antibody used in the treatment of inflammatory allergic diseases, such as atopic dermatitis and asthma. 

Ms. Chen said CBP-201 has the potential to be differentiated from two approved antibodies that target IL-4Ra. She cited high binding affinity and potency, which may translate to improved clinical response; a more convenient dosing regimen; and strong efficacy based on post-hoc analyses from its Phase 2b data.