Evercore ISI initiated coverage of Gracell Biotechnologies (NASDAQ:GRCL) with an “outperform” rating and no price target. The stock was quoted at $5.43 midday on Nov. 27.
Gracell is developing a unique CAR-T construct for the treatment of multiple myeloma (MM). The construct, which targets both the B cell maturation antigen and CD19 receptors, demonstrated a potentially best-in-class median progression-free survival of 38 months in a Phase 1 trial.
In a research note, analyst Jonathan Miller writes that Gracell is the first company to collect CAR-T data in the first-line MM setting, and that the bispecific antibody candidate has not shown any neurotoxicity to date.
He notes that Gracell is late to market, with a potential launch in 2027 and no established pharma partner, however “modeling only an extremely conservative share in MM, there is significant upside to the stock.”
Mr. Miller compares Gracell’s $350-million market cap with those of its competitors, such as Arcellx, which currently has a market cap of some $2.5-billlion and plans to launch its own MM CAR-T treatment in 2026 or 2027.
Gracell is also developing the candidate for the treatment of systemic lupus erythematosus. “With first-in-human data expected in the first half of 2024, this could easily become a significant value driver,” he said.
