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Investing.com - BTIG has reiterated its Buy rating and $6.00 price target on Mereo BioPharma Group (NASDAQ:MREO), currently trading at $2.94, following an update on the company’s Orbit clinical trial for setrusumab. According to InvestingPro data, analysts are highly bullish on the stock, with targets ranging from $6.01 to $10.01.
Ultragenyx and Mereo BioPharma announced that the Orbit trial will proceed to final analysis around year-end 2025 based on feedback from the Data Monitoring Committee (DMC). While the second interim analysis did not meet the prespecified threshold for disclosure, BTIG expects positive results from the Phase 3 portion upon final analysis. InvestingPro data shows the company maintains strong financial health with a current ratio of 8.92, indicating robust liquidity to support its clinical programs.
The DMC has informed management that setrusumab has demonstrated an acceptable safety profile in both the Orbit and Cosmic trials. Data from the Cosmic trial, an ongoing open-label Phase 3 study in patients aged 2 to under 7 years, is expected to be disclosed concurrently with Orbit results around year-end 2025.
Mereo BioPharma owns double-digit royalties on U.S. net sales, majority European rights, and is eligible for up to $245 million in outstanding milestones from Ultragenyx for setrusumab, which aims to address osteogenesis imperfecta (OI).
BTIG estimates setrusumab will address a significant unmet need in OI as an active and safe treatment, corresponding to a market opportunity at a low- to mid-six-figure annualized net price and a combined U.S. and Europe total addressable market of approximately 60,000 patients. With a market capitalization of $467.46 million and minimal debt-to-equity ratio of 0.01, the company appears well-positioned to capitalize on this opportunity. For deeper insights into Mereo BioPharma’s financial health and growth potential, access the comprehensive Pro Research Report available on InvestingPro, which offers exclusive analysis of over 1,400 US stocks.
In other recent news, Mereo BioPharma Group and Ultragenyx Pharmaceutical (NASDAQ:RARE) have announced the continuation of their Phase 3 Orbit study for UX143 (setrusumab) in patients with osteogenesis imperfecta. The study is progressing to a final analysis, expected by the end of 2025, after not meeting criteria for an early stoppage. The Data Monitoring Committee confirmed that UX143 maintains an acceptable safety profile. Needham has reduced its price target for Mereo BioPharma from $7.00 to $5.00, although it maintained a Buy rating, citing increased uncertainty due to the trial delay. Despite this, Needham remains optimistic about setrusumab’s long-term potential, emphasizing the relationship between bone mineral density improvements and reduced fracture rates. Meanwhile, JPMorgan has reiterated an Overweight rating with a $7.00 price target, viewing the market reaction as an overreaction and maintaining confidence in the final analysis. Both the Orbit and Cosmic studies will continue, with final analyses planned after patients have been on therapy for at least 18 months. These developments are based on recent press releases and filings with the Securities and Exchange Commission.
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