Stryker shares tumble despite strong Q2 results and raised guidance
On Wednesday, H.C. Wainwright reaffirmed its Buy rating on Rezolute (NASDAQ:RZLT) with a price target of $14.00. The company, currently trading at $5.50 with a market capitalization of $319 million, has delivered an impressive 468% return over the past year according to InvestingPro data. The firm’s analyst, Douglas Tsao, highlighted the recent approval for Rezolute to enroll infants in the Phase 3 SunRIZE study of its drug candidate ersodetug. The Data Monitoring Committee (DMC) reviewed safety data from the open-label arm of the study, which included infants aged 3 months to 1 year, and concluded that ersodetug is safe at the administered doses.
The positive safety assessment enables Rezolute to proceed with dosing in the double-blind portion of the trial. The analyst believes this development further substantiates the safety profile of ersodetug among pediatric patients. InvestingPro data shows strong analyst confidence in the company, with analyst price targets ranging from $8 to $16, and two analysts recently revising their earnings expectations upward. The U.S. Food and Drug Administration (FDA) had previously lifted partial clinical holds on the drug in September 2024, allowing the company to dose U.S. patients over 3 months old. The company plans to activate U.S. study sites and start patient enrollment within this quarter.
Ersodetug received the FDA’s Breakthrough Therapy Designation in January, which is anticipated to facilitate rapid enrollment at U.S. sites. While the specific age range of patients to be enrolled at U.S. sites has not been disclosed, management expects a trend toward younger patients compared to other locations. Rezolute anticipates completing patient enrollment by the second quarter of 2025 and expects to release topline results by the fourth quarter of the same year. However, there is a possibility that the readout may be delayed until mid-2026 if an interim analysis suggests an increase in SunRIZE patient enrollment is necessary.
The company has yet to reveal the powering assumptions for the SunRIZE study but has indicated a conservative estimate that assumes a 35% placebo rate, with a treatment effect 35% higher than this rate required to achieve statistical significance. With these developments, H.C. Wainwright maintains its Buy rating and $14 price target for Rezolute. The company maintains a strong financial position with more cash than debt and a healthy current ratio of 13.8. InvestingPro analysis reveals additional valuable insights about Rezolute’s financial health and growth prospects, available in the comprehensive Pro Research Report, which offers deep-dive analysis of over 1,400 US stocks.
In other recent news, Rezolute, Inc. has made significant strides in its clinical trials and corporate restructuring. The company’s Phase 3 study of ersodetug, a treatment for hypoglycemia due to congenital hyperinsulinism, has reached a pivotal stage with the independent Data Monitoring Committee approving the enrollment of infants. The drug has also received Breakthrough Therapy Designation from the U.S. Food and Drug Administration, expediting its development and review process.
In addition, Rezolute has shared a patient’s experience participating in their ongoing Phase 2 clinical trial through a video presentation, emphasizing the importance of patient perspectives. The company has also increased its authorized common stock from 100 million to 165 million shares following shareholder approval, aligning its financial strategies with its growth objectives.
Analyst firm BTIG maintained its neutral stance on Rezolute, acknowledging the FDA’s recent Orphan Drug Designation awarded to ersodetug for the treatment of tumor-induced hypoglycemia. The company anticipates initiating a Phase 3 study for tumor HI within the same timeframe as the completion of the sunRIZE study. These are recent developments that highlight the company’s commitment to advancing treatments for rare diseases with significant unmet needs.
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