JPMorgan sets CG Oncology stock overweight, $41 target

Published 02/05/2025, 08:34
JPMorgan sets CG Oncology stock overweight, $41 target

On Friday, JPMorgan initiated coverage of CG Oncology (NASDAQ:CGON) with an Overweight rating and a price target of $41.00, adding to the optimistic outlook for the $2.1 billion market cap company. The investment bank’s analysts highlighted CG Oncology’s progress in the development of its lead asset, Cretostimogene, a novel oncolytic viral therapy aimed at treating non-muscle invasive bladder cancer (NMIBC). According to InvestingPro data, the stock has shown impressive momentum with a 24% return over the past week.

CG Oncology’s stock has shown an upward trend following recent updates at the American Urological Association (AUA) meeting. Competing treatments have reported 12-month complete response (CR) data that fell short of expectations, which, according to JPMorgan, positions Cretostimogene favorably in the market. InvestingPro analysis shows the company maintains a strong financial position with a current ratio of 35.3, indicating robust liquidity to support its development programs.

The company is on track to file its first Biologics License Application (BLA) in the second half of this year, amidst a competitive NMIBC market. JPMorgan’s analysis, which includes feedback from oncologists, suggests that Cretostimogene stands out due to its mechanism of action, safety profile with no Grade 3 or higher treatment-related adverse events (TRAEs), and durability. These factors are anticipated to help CG Oncology capture a significant share of the market.

Furthermore, the analysts noted the potential for increased preference for Cretostimogene among physicians, especially considering its non-chemotherapy-based approach. This could be particularly appealing for patients who have previously experienced intravesical gemcitabine/docetaxel, which accounts for 40% of patients.

JPMorgan’s positive outlook on CG Oncology is based on the company’s strategic positioning and the differentiating factors of its product in an evolving treatment landscape, which is currently experiencing a shortage of Bacillus Calmette-Guerin (BCG), the standard treatment for NMIBC.

In other recent news, CG Oncology has reported significant advancements in its Phase 3 study of cretostimogene, an investigational treatment for high-risk non-muscle invasive bladder cancer. The study, involving 110 patients, demonstrated a 75.5% complete response rate at some point during the trial, with a median duration of response exceeding 28 months. The 12-month complete response rate was 46%, with 30 confirmed responses at 24 months. UBS, Cantor Fitzgerald, and H.C. Wainwright have all maintained their positive ratings on CG Oncology, citing the promising data. UBS reaffirmed its Buy rating with a $60 target, noting the product’s durability and safety compared to competitors. Cantor Fitzgerald and H.C. Wainwright both reiterated their Buy ratings with a $75 target, emphasizing the potential for cretostimogene to capture a significant market share. The safety profile of cretostimogene was also notable, with no severe treatment-related adverse events reported. Analysts continue to express confidence in CG Oncology’s market potential, highlighting the treatment’s strong efficacy and safety profile.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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