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Investing.com - Goldman Sachs initiated coverage on Crinetics Pharmaceuticals (NASDAQ:CRNX) with a Neutral rating and a $36.00 price target on Thursday. The biotech company, currently valued at $3.03 billion, has shown strong momentum with an 8.49% gain over the past week, according to InvestingPro data.
The investment bank cited uncertainties around the upcoming launch of paltusotine, Crinetics’ lead drug candidate for acromegaly, which has a September 25 PDUFA date with the FDA. Goldman Sachs models less than $600 million in risk-adjusted peak sales for paltusotine by 2042, noting the limited size of its addressable patient population. InvestingPro analysis shows the company maintains a strong financial position with a current ratio of 22.53, indicating robust liquidity to support its drug development programs.
Goldman Sachs also highlighted atumelnant, Crinetics’ MC2R antagonist for congenital adrenal hyperplasia (CAH), which is expected to begin pivotal studies in the second half of 2025. Despite atumelnant’s larger market potential of approximately $1 billion in risk-adjusted peak sales, the firm estimates it will launch around three years behind competitor Crenessity in 2028.
The investment bank expressed concerns about atumelnant’s pivotal Phase 3 studies, which carry risks due to substantial differences from Phase 2 trials and Crenessity’s Phase 3 studies. Goldman Sachs is monitoring Crenessity’s launch metrics, including prescription trends and reimbursement criteria, as indicators for atumelnant’s potential.
The Neutral rating reflects these considerations and Goldman Sachs’ view that CRNX’s near-term stock performance will be heavily dependent on paltusotine’s launch and Crenessity’s market performance, with few other meaningful pipeline catalysts on the horizon. While the company currently faces profitability challenges, InvestingPro subscribers can access 12 additional key insights and a comprehensive analysis of Crinetics’ financial health and growth prospects through the Pro Research Report.
In other recent news, Crinetics Pharmaceuticals reported a decline in revenue for Q1 2025, with figures dropping to $400,000 from $600,000 in the same quarter the previous year. Despite the decrease, the company is gearing up for the anticipated commercial launch of paltusotine, an oral treatment for acromegaly, expected in September 2025. Analysts from JMP Securities and H.C. Wainwright have reiterated their positive ratings on Crinetics, with price targets set at $90 and $81, respectively, highlighting the company’s drug discovery capabilities and potential in the acromegaly market. Crinetics is also preparing for a Phase 3 study of atumelnant for congenital adrenal hyperplasia (CAH), scheduled for the first half of 2025. The company plans to expand its clinical trials into pediatric studies and ACTH-dependent Cushing’s syndrome in the latter half of 2025. Additionally, Crinetics maintains a strong cash position, with reserves expected to fund operations into 2029, supporting its ongoing research and development initiatives.
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