SVB Securities starts Morphic Holding at OW; PT $45

SVB Securities launched coverage of Morphic Holding (NASDAQ:MORF) with an “outperform” rating and $45 price target. The stock closed at $24.99 on July 19.

Morphic is a clinical-stage biotechnology company developing first-in-class oral integrin therapies. Its lead product candidate, MORF-057, is an orally administered small molecule, alpha4beta7-specific integrin inhibitor, a de-risked mechanism that is clinically and commercially validated by Takeda’s Entyvio, which has been approved for the treatment of both ulcerative colitis and Crohn’s disease.

Analyst Mike Kratky writes that despite a burdensome route of administration that requires 30-minute intravenous infusions by a healthcare professional, Entyvio achieved about $4-billion in 2021 sales in inflammatory bowel disease based on its strong safety and efficacy profile relative to other available therapies.

“Morphic’s Phase 1 results indicate MORF-057 has a favorable safety profile with pharmacokinetic/pharmacodynamic properties that, if approved, could make it an attractive oral alternative to Entyvio,” Mr. Kratky said.

“Overall, we see a significant opportunity for MORF-057 and believe Morphic could provide significant strategic value to an acquirer based on the high demand for safe and effective oral therapies in inflammatory bowel disease,” he added.