Ladenburg Thalmann launched coverage of Reata Pharmaceuticals (NASDAQ:RETA) with a “buy” rating and price target of $55. The stock closed at $21.21 on April 12.
Reata focuses on development of small molecule drugs for the treatment of orphan diseases driven by mitochondrial dysfunction and inflammation. The company’s primary programs are novel Nrf-2 activators: bardoxolone methyl and omaveloxolone.
The company’s lead program, bardoxolone methyl, is currently in Phase 3 development for the treatment of connective tissue disease-associated pulmonary arterial hypertension (CTD-PAH).
Analyst Matthew Kaplan writes that the company has already reported impressive Phase 2 data for the treatment of CTD-PAH, showing a significant improvement in six-minute walk distance. Top-line data from the Phase 3 CTD-PAH study, CATALYST, is expected in the first half of 2018.
“We believe there is a strong likelihood for a positive readout for the CATALYST study based on the strength of the Phase 2 data in this patient population,” he added. “We believe the program is on track for an NDA filing in the U.S. and E.U. by yearend 2018, with approval expected in mid-2019.”
Mr. Kaplan said omaveloxolone, the company’s next generation Nrf2-activator designed to cross the blood-brain barrier, is being developed as a treatment for two orphan diseases: Friedreich’s ataxia (FA) and mitochondrial myopathy (MM).
Omaveloxolone is currently in a Phase 2 FA study, with top-line Phase 2 data expected in mid-2017, he said. In addition, omaveloxolone is currently in a Phase 2 MM study, with top-line Phase 2 data expected in the second half of 2017.
