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On Monday, Chardan Capital Markets revised its price target on Prime Medicine (NASDAQ: PRME) shares, decreasing it to $12 from the previous $16 while retaining a Buy rating on the stock. Currently trading at $1.29, the stock sits near its 52-week low of $1.11, having declined about 78% over the past year. According to InvestingPro analysis, Prime Medicine appears undervalued based on its Fair Value assessment. The adjustment followed Prime Medicine’s announcement regarding its clinical developments in gene editing therapies.
Prime Medicine reported that its prime editing asset for Chronic Granulomatous Disease (CGD), PM359, exhibited promising results in the first patient treated. Despite this, the company has decided to shift its focus towards its in vivo liver-directed prime editing programs, specifically targeting Wilson’s disease and alpha-1 antitrypsin deficiency (AATD). With a market capitalization of $203 million and an overall weak financial health score according to InvestingPro, this strategic change mirrors a similar move by Editas Medicine (NASDAQ:EDIT) last year, which also transitioned its efforts to in vivo therapies.
Chardan’s analyst noted that while PM359 represents a significant step towards clinical proof of concept for prime editing, and is likely to succeed technically, it contributes only modestly to the company’s valuation due to the small size of the patient population. Consequently, CGD has been removed from Chardan’s valuation model, and the firm has adopted more conservative assumptions regarding the platform’s value beyond the current programs, leading to the lowered price target.
The company’s decision to de-prioritize its CGD franchise is seen as a strategic move to concentrate on areas with potentially higher commercial success, as the market for ex vivo Hematopoietic Stem Cell (HSC) therapies has yet to be established.
With clinical outcomes for the prioritized programs not anticipated until 2027, Chardan anticipates that business development activities will be the next potential catalyst for value creation for Prime Medicine. The firm will be monitoring these developments for opportunities that may positively impact the stock’s value. Analyst consensus remains optimistic, with price targets ranging from $6 to $18. For deeper insights into Prime Medicine’s financial health, valuation metrics, and growth potential, access the comprehensive Pro Research Report available on InvestingPro, which offers expert analysis of over 1,400 US stocks.
In other recent news, Prime Medicine has made strategic shifts and leadership changes while advancing its liver disease programs. The company announced a focus on Wilson’s disease and Alpha-1 Antitrypsin Deficiency (AATD), with regulatory filings expected in 2026 and initial clinical data anticipated in 2027. Prime Medicine’s leadership transition includes Allan Reine stepping in as CEO and Jeff Marrazzo becoming Executive Chair, following Keith Gottesdiener’s departure. The company is also implementing a workforce reduction of approximately 25% to extend its financial runway into 2026.
Analysts have been adjusting their outlooks on Prime Medicine. Jefferies cut its price target to $9 but maintained a Buy rating, while Citi and H.C. Wainwright both reaffirmed their Buy ratings with a $10 target. Chardan Capital Markets also reduced its price target to $16 while maintaining a Buy rating, highlighting Prime Medicine’s progress in its AATD program. The company is continuing its in vivo Cystic Fibrosis program and developing Prime Edited CAR-T products with Bristol Myers (NYSE:BMY) Squibb.
Prime Medicine is seeking an external partner to continue clinical development for its Chronic Granulomatous Disease (CGD) program. The company is also engaged in arbitration with Beam Therapeutics over rights to pursue its AATD program. These developments reflect Prime Medicine’s commitment to focusing resources on promising therapeutic programs and advancing its gene-editing technology.
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