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Investing.com - Mizuho has initiated coverage on Kala Bio (NASDAQ:KALA) with an Outperform rating and a $30.00 price target, implying potential upside of over 100%. The stock has already demonstrated strong momentum, gaining nearly 30% in the past week and over 140% in the last year, according to InvestingPro data.
The research firm cited Kala Bio’s novel platform technology for developing treatments for rare eye diseases as a key factor in its positive outlook for the clinical-stage biotech company. While InvestingPro data shows the company is quickly burning through cash with negative EBITDA of $40.28 million, its current ratio of 2.1 indicates sufficient liquidity to meet near-term obligations.
Mizuho highlighted a significant near-term catalyst expected by the end of September, with Phase 2 data for Kala’s lead asset KPI-012 in persistent corneal epithelial defect (PCED), which the firm notes is already a $1 billion-plus commercial market.
The research firm assigned a 30% probability of success for the treatment and indicated that for success in Phase 2, they would ideally like to see approximately 50% separation from placebo on the primary efficacy endpoint.
Mizuho acknowledged that while the stock has already been rising ahead of the Phase 2 data release, they see significant potential upside of perhaps over 300% on a successful outcome, though they caution that negative data could reduce the stock to approximately $2.
In other recent news, Kala Bio announced the appointment of Todd Bazemore as Chief Executive Officer, effective August 29, 2025. Bazemore, who has been serving as interim CEO since February 2025, will also continue his role as President while stepping down as Chief Operating Officer. Additionally, he was elected as a Class II director on the company’s board, a position he will hold until the 2025 Annual Meeting of Stockholders. In another development, Kala Bio completed patient enrollment in its CHASE Phase 2b clinical trial for KPI-012, aimed at treating persistent corneal epithelial defect. The trial is designed to evaluate the safety and efficacy of KPI-012, with results expected in the third quarter of 2025. These recent developments mark significant milestones for Kala Bio as it progresses in both its leadership and clinical trial efforts.
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