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Wednesday, H.C. Wainwright reiterated a Buy rating and a $30.00 price target on Olema Pharmaceuticals (NASDAQ:OLMA) stock, representing over 600% upside from the current price of $4.14. According to InvestingPro data, the stock is trading near its 52-week low of $3.95, having declined about 69% over the past six months. The broader analyst consensus remains highly bullish with a 1.38 rating (where 1 is Strong Buy). The firm’s analyst emphasized the promising results from Olema’s Phase 2 study of palazestrant (pala) in combination with ribociclib (ribo) for treating ER+/HER2- metastatic breast cancer (mBC). The study showed a median progression-free survival (PFS) of 13.8 months for all patients and 13.1 months for those previously treated with CDK4/6 inhibitors and endocrine therapy (ET).
The analyst noted the median PFS of over 13 months for both patient groups in Olema’s study could be considered potentially best-in-class when compared to similar oral SERD + CDK4/6i combination studies. Competitor studies have reported median PFS ranging from 8-9 months. The current data, with 24 patients still on study as of February 18, 2025, suggests the potential for this number to increase, with more mature data expected to be presented later in the year, possibly at the American Society of Clinical Oncology (ASCO) meeting.
Olema’s reported data also indicates a potentially differentiated efficacy profile for palazestrant and ribociclib across various patient subtypes, including those with ESR1 mutant (ESR1m) and ESR1 wild-type (ESR1wt). This distinction is seen as a positive indicator for Olema’s planned Phase 3 (OPERA-02) trial in 2025, which aims to explore the combination as a first-line (1L) treatment.
The analyst’s reiteration of the Buy rating and the $30 price target comes after Olema Pharmaceuticals disclosed its fourth-quarter and full-year financial results for 2024. The results included updates on the company’s clinical developments and progress in its ongoing trials. InvestingPro analysis reveals the company maintains a strong liquidity position with a current ratio of 10.4, though it’s currently experiencing rapid cash burn. InvestingPro subscribers have access to 11 additional key insights about OLMA’s financial health and market position.
Olema Pharmaceuticals is focused on the development of targeted therapies for women’s cancers, and the latest results from its Phase 2 trial have been met with optimism by H.C. Wainwright. The firm’s positive outlook on the stock remains unchanged following the recent data announcement. With a market capitalization of $308 million and trading below book value at a P/B ratio of 0.75, InvestingPro analysis suggests the stock may be undervalued at current levels, despite near-term profitability challenges. Discover more detailed valuation metrics and financial health indicators with an InvestingPro subscription.
In other recent news, Olema Pharmaceuticals announced significant developments in its ongoing clinical trials and corporate activities. The company reported promising results from its Phase 2 study of palazestrant combined with ribociclib for treating ER+/HER2- metastatic breast cancer. The study showed a median progression-free survival (PFS) of 13.8 months, surpassing the typical 8-9 month range observed in similar studies. Olema plans to initiate a Phase 3 trial in 2025 and anticipates presenting updated data at a medical conference later this year. H.C. Wainwright reaffirmed its Buy rating and $30 price target for Olema, reflecting confidence in the drug’s efficacy.
Additionally, Olema Pharmaceuticals disclosed an unregistered exchange of equity securities with Bain Capital Life Sciences Opportunities IV, L.P., Paradigm BioCapital International Fund Ltd., and BVF Partners L.P. The transaction involves exchanging 6,070,000 shares of common stock for pre-funded warrants. These warrants have an exercise price of $0.0001 per share and are immediately exercisable. This exchange is conducted under Section 3(a)(9) of the Securities Act, allowing for the exchange of securities without registration. The closing of the transaction is expected on January 13, 2025, with the estimated outstanding shares of common stock post-exchange being 68,333,065.
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