On Thursday, H.C. Wainwright adjusted its outlook on Viridian Therapeutics (NASDAQ: VRDN) shares, raising its price target on the stock to $34 from $27 while maintaining a Buy rating. The firm's analyst highlighted the potential of Viridian's veligrotug to meet endpoints in the chronic thyroid eye disease (TED) study, drawing a comparison to Tepezza's demonstrated efficacy in treating chronic TED.
The analyst noted veligrotug's promising results in the THRIVE-1 study, particularly its better placebo-adjusted difference in proptosis mean change from baseline among active TED patients.
The optimism for veligrotug stems from its potential to surpass Tepezza as the leading treatment for TED, as evidenced by the latter's modest sales growth from $479 million in the second quarter to $488 million in the third quarter. The analyst pointed out that veligrotug's safety profile could be a significant advantage, with a lower incidence of hearing impairment observed in the THRIVE-1 study compared to Tepezza.
Specifically, the placebo-adjusted rate of hearing impairment with veligrotug was 5%, versus 10% with Tepezza, and all cases of hearing loss in the THRIVE-1 study were partial, not complete.
The reduced number of infusions required for veligrotug treatment, which is five compared to Tepezza's eight, could contribute to its better safety profile. With these encouraging data points, H.C. Wainwright has increased the probability of success (PoS) for veligrotug to 80% from the previous 75%. Additionally, the firm raised the enterprise value to sales (EV/sales) multiple to 8.5x from 6x.
The potential Biologics License Application (BLA) submission for veligrotug is anticipated in the second half of 2025. The analyst expressed confidence in the upcoming THRIVE-2 readout, which further supports the decision to raise the price target for Viridian Therapeutics. The firm's revised target reflects a positive outlook based on the impressive data from the THRIVE-1 study and the expected continued success in the development of veligrotug.
In other recent news, Viridian Therapeutics has been the focus of several analyst firms following the success of its Phase III THRIVE trial. The trial, which tested the drug veligrotug for treating active Thyroid Eye Disease (TED), met all primary and secondary endpoints.
Analyst firms such as Stifel, Needham, and Goldman Sachs (NYSE:GS) have maintained their Buy ratings on Viridian, adjusting their price targets upwards. RBC Capital also raised its price target for Viridian while maintaining an Outperform rating.
Viridian's recent developments also include a public offering of $150 million of its common stock and Series B non-voting convertible preferred stock. The proceeds from this offering will be used for clinical development programs, working capital, and general corporate purposes.
Furthermore, Viridian has shown progress in its FcRn franchise, with recent interim non-human primate data demonstrating a threefold increase in half-life compared to efgartigimod, along with sustained IgG suppression. The challenge ahead will be translating these results to human trials.
The company has also completed enrollment for its Phase 3 trial of VRDN-001, with top-line results expected in the near future. In addition, Viridian has initiated two global phase 3 trials, REVEAL-1 and REVEAL-2, for VRDN-003, a subcutaneous form of the antibody. These are the recent developments in Viridian's ongoing efforts.
InvestingPro Insights
Recent InvestingPro data provides additional context to Viridian Therapeutics' (NASDAQ: VRDN) financial position and market performance. The company's market capitalization stands at $1.78 billion, reflecting investor interest in its potential. Despite the optimism surrounding veligrotug, it's important to note that Viridian is not currently profitable, with a negative P/E ratio of -6.93 over the last twelve months as of Q3 2024.
InvestingPro Tips highlight that Viridian holds more cash than debt on its balance sheet, which could be crucial for funding ongoing research and development efforts for veligrotug. Additionally, the stock has shown strong returns over the last three and six months, aligning with the positive outlook from H.C. Wainwright's analysis.
However, investors should be aware that Viridian suffers from weak gross profit margins, which may impact its financial stability as it works towards potential BLA submission in 2025. The company's revenue for the last twelve months was only $0.3 million, underscoring its pre-commercial stage.
For those seeking a more comprehensive analysis, InvestingPro offers 11 additional tips that could provide deeper insights into Viridian's financial health and market position.
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