On Thursday, Kura Oncology (NASDAQ:KURA) shares maintained their Buy rating, according to a recent endorsement by TD Cowen. The firm's optimistic stance is rooted in Kura's recent strategic alliance with Kyowa Kirin, a partnership aimed at advancing and marketing ziftomenib, a promising cancer treatment.
Under the terms of the collaboration, profits and losses in the U.S. market will be split equally between the two companies. Outside the U.S., Kura is set to receive a double-digit percentage of net sales as royalty.
The agreement is particularly significant for Kura Oncology as it provides the means to fund the development of ziftomenib, especially in first-line (1L) treatment settings, while still holding on to substantial economic benefits. This collaboration marks a strategic move for the company as it continues to focus on developing treatments in the oncology field.
TD Cowen highlighted that the partnership enables Kura to support the development of ziftomenib in the first-line acute myeloid leukemia (AML) setting. This is a key area of focus for the company, given the critical need for effective treatments in cancer care. The analyst noted the deal's potential to bolster Kura's financial position and its strategic implications for the company's growth.
The pivotal program for ziftomenib in treating 1L AML is scheduled to commence in mid-2025. This timeline sets a clear pathway for Kura Oncology's efforts to bring the treatment to market and potentially improve outcomes for AML patients. The continued Buy rating reflects confidence in Kura's strategic direction and its partnership's potential to drive future success.
In other recent news, Kura Oncology has reported significant advancements in its menin inhibitor program, specifically ziptamenib's treatment for acute myeloid leukemia (AML), despite a net loss of $54.4 million for the third quarter. The company's financial stability is maintained with over $455 million in assets, ensuring operations can continue into 2027.
The recent strategic collaboration with Kyowa Kirin for the development and commercialization of ziftomenib includes a substantial $330 million upfront payment to Kura and the possibility of up to $420 million in near-term milestone payments. H.C. Wainwright has reaffirmed a Buy rating on Kura Oncology, raising the target price to $37.00 from the previous $32.00, following these developments.
Similarly, Jefferies has maintained a Buy rating on Kura Oncology, though they reduced the stock's price target from $32.00 to $28.00. These adjustments reflect the recent collaboration and the revised development trajectory for ziftomenib. These recent developments are expected to enhance Kura's position in the oncology market and contribute to the company's growth prospects.
InvestingPro Insights
Kura Oncology's strategic alliance with Kyowa Kirin aligns well with its current financial position and future prospects. According to InvestingPro data, Kura holds more cash than debt on its balance sheet, which is crucial for funding ongoing research and development efforts. This financial stability is particularly important as the company prepares for the pivotal program of ziftomenib in 2025.
Despite the positive outlook on the Kyowa Kirin partnership, InvestingPro Tips highlight that seven analysts have revised their earnings downwards for the upcoming period. This caution may be attributed to the company's current unprofitability, as indicated by the negative operating income of -$217.5 million over the last twelve months.
However, it's worth noting that Kura's stock has shown a high return over the last year, with a 70.34% price total return. This performance suggests investor confidence in the company's long-term potential, possibly influenced by strategic moves like the recent partnership.
For investors seeking a more comprehensive analysis, InvestingPro offers additional tips and insights. Currently, there are 5 more InvestingPro Tips available for Kura Oncology, which could provide further context to the company's financial health and market position.
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