Antibe: Canaccord Cuts Price Target From $5.00 To $1.20 After Drug Pivot

In early August, Antibe Therapeutics Inc. (TSX: ATE) announced that they have paused their study of otenaproxesul because it breached the threshold for the number of patients exhibiting liver transaminase elevations. Then, last week, Antibe provided an update following a full scientific and strategic review. The company is now pivoting from a focus on osteoarthritis to post-operative pain, with the details of the program being few and far between in the news release.

Antibe Therapeutics currently has 6 analysts covering the stock with an average 12-month price target of C$5.58, or a 475% upside. Out of the 6 analysts, 4 have buy ratings and 2 have hold ratings. The street high sits at $20.60 while the lowest comes in at $1.20.

Canaccord Genuity lowered their 12-month price target after the news, bringing it to C$1.20 from C$5 while also lowering the stock to hold from a speculative buy rating. This price target cut reflects Canaccord removing otenaproxesul from their valuation since the full details of the program have not been outlined.

With the pivot, Canaccord believes that the osteoarthritis program is very uncertain to be resumed, they previously stated that they were hopeful that the company could get a new program up at a 75 mg dose rather than the 100 mg dose that got paused. But they now say “given the occurrence of LTEs in one patient at this dose, there is no reason for ATE to resume the study.”

As for the pivot to post-operative pain, Canaccord warns “NSAIDs are challenged by their GI safety profile, while opioids pose the dangerous risk of dependency.” They believe that Antibe could skip straight to a Phase 2 trial but management has elected to do some Phase 1 PK/PD studies starting in January 2022.

With the companies $60 billion balance sheet, management has stated that they will be able to fund fully the development. While Canaccord writes, “We believe ATE could need cash sooner should it decide to also progress any of its preclinical programs.”

Information for this briefing was found via Sedar and Refinitiv. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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