There’s nothing like a slice of good news to send the stock of a micro-cap biotech on an almighty tear. On Tuesday, the blueprint was followed to a tee.
Shares of Pieris Pharmaceuticals (PIRS) more than doubled in the session after it was announced that the Boston-based company had nabbed a deal that could generate it a lot of money.
Specifically, the company said it was forming a partnership with Roche subsidiary Genentech to collaborate on the development of respiratory and ophthalmology therapies based on Pieris' Anticalin technology.
Pieris will secure an upfront payment of $20 million and will be entitled to over $1.4 billion in potential milestone payments plus tiered royalties in the mid-single to low double-digit range.
The discovery and early preclinical development will fall under Pieris’ remit, while IND-enabling activities all the way through to potential commercialization, will be Genentech’s responsibility.
“We continue to be impressed with Pieris' business development capabilities as interest around the Anticalin platform continues to grow,” said H.C. Wainwright’s Joseph Pantginis. “We look forward to additional visibility around assets that are developed through this new partnership.”
As Pantginis also notes, this is not the first important partnership Pieris has signed. The company is also collaborating with AstraZeneca on the development of respiratory diseases. The program is currently led by PRS-060, an inhaled IL-4Ra inhibitor undergoing testing for the treatment of moderate-to-severe asthma. A Phase 2a study study kicked off recently, and a data readout from the trial is anticipated in 2022. Following the program’s successful initiation, Pieris stands to receive a $13 million milestone payment from AstraZeneca.
The shares might have surged ahead, but Pantginis thinks there’s a way to go still. The 5-star analyst’s price target is $9, suggesting further upside of 165%. Needless to say, Pantginis’ rating is a Buy. (To watch Pantginis’ track record, click here)
While there are only two other analysts currently keeping a tab on Pieris’ developments, both are on the bullish side of the fence. The two additional Buys result in a Strong Buy rating, while the $6 average price target implies shares will add an extra 78% of muscle over the next 12 months. (See Pieris stock analysis on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.