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Investing.com - Stifel maintained its Buy rating and $10.00 price target on Alto Neuroscience (NYSE:ANRO) Thursday following the company’s announcement of Phase 2 proof-of-concept results for its ALTO-203 drug in major depressive disorder patients with anhedonia. According to InvestingPro data, the $67.68M market cap company has seen a 13% surge in the past week, though it remains undervalued based on Fair Value analysis.
The trial produced mixed results, with ALTO-203 demonstrating reductions in the target EEG biomarker (theta/beta ratio) but failing to separate from placebo on the BL-VAS mood scale following a single dose, which was the primary endpoint of the study. While the company maintains a strong liquidity position with a current ratio of 22.53, InvestingPro data indicates rapid cash burn, a crucial factor for clinical-stage biotech companies.
In the multi-dose portion of the trial, only the low 25ug-arm showed a small separation versus placebo on the Montgomery-Åsberg Depression Rating Scale (MADRS), with differences of 2 and 0.9 points at 3 and 4 weeks, respectively, though the study was not powered to detect a signal on this measure.
Stifel noted that ALTO-203 exhibited significant improvements in sustained attention and increased wakefulness, with the strongest results observed in patients with more abnormal theta/beta EEG ratios at baseline—a biomarker that can be used as a diagnostic in ADHD.
The firm described the trial as exploratory with low expectations, suggesting that while some optionality is maintained with this program, it is not thesis-impacting for Alto Neuroscience as the company prioritizes its late-stage pipeline, with next development steps for ALTO-203 to be determined. Analyst targets range from $4 to $18, reflecting diverse views on the company’s potential. Get deeper insights and access to 8 additional ProTips with InvestingPro.
In other recent news, Alto Neuroscience has reported significant developments in its clinical trials and strategic acquisitions. The company has identified a biomarker for its drug ALTO-203 in a Phase 2 trial, which demonstrated improvements in attention and wakefulness in patients with major depressive disorder. Additionally, Alto Neuroscience has acquired ALTO-207, a treatment candidate for treatment-resistant depression, from Chase Therapeutics. The acquisition includes a fixed-dose combination of pramipexole and ondansetron, which has shown promising results in Phase 2a trials. Analysts at H.C. Wainwright have maintained a Buy rating on Alto Neuroscience, citing confidence in the company’s strategic direction and future prospects. Furthermore, Alto Neuroscience presented data at the American Society of Clinical Psychopharmacology Annual Meeting, highlighting the favorable tolerability profile of its drug ALTO-300 in recent trials. The company’s research linked ALTO-300 to a specific EEG biomarker, suggesting a connection between the drug and patient selection criteria. These developments underscore Alto Neuroscience’s ongoing efforts to advance its pipeline and address unmet needs in psychiatric treatment.
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