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On Monday, H.C. Wainwright analyst Vernon Bernardino revised the price target for Moleculin Biotech (NASDAQ:MBRX) shares, setting it at $8.00, a significant decrease from the previous $45.00 target. Despite the reduction, the firm maintains a Buy rating on the stock. According to InvestingPro data, the stock has shown remarkable resilience with a 20.56% gain over the past week, though it remains significantly below its 52-week high of $10.35. Bernardino’s report follows Moleculin Biotech’s recent announcement regarding FDA feedback on its Investigational New Drug (IND) application amendment for the MIRACLE study, which is a pivotal Phase 3 trial for Annamycin in combination with cytarabine for the treatment of acute myeloid leukemia patients who have not responded to initial therapy.
The FDA’s guidance included a recommendation to reduce the size of Part B of the trial by 10%, now involving approximately 220 subjects compared to the previously expected 244. These patients will be randomized to receive either high-dose cytarabine plus placebo or high-dose cytarabine plus an optimized dose of Annamycin. InvestingPro analysis shows the company maintains a healthy current ratio of 2.08 and holds more cash than debt on its balance sheet, which could support the trial’s execution. Get access to 12+ additional ProTips and comprehensive financial analysis with an InvestingPro subscription. This change is seen as a positive step, enabling the company to expedite the opening of trial sites in the U.S., Europe, and the Middle East, with the aim to treat the first subject in the first quarter of 2025.
Annamycin, which is characterized by its lack of cumulative cardiotoxicity—a common limitation in long-term use of other anthracyclines—is considered a next-generation treatment. The drug has already received Fast Track and Orphan Drug Designation from the FDA for this indication, as well as Orphan Drug Designation from the European Medicines Agency (EMA). The analyst believes that the potential for these regulatory features to expedite Annamycin’s approval timeline is currently undervalued.
The price target adjustment also takes into account a 1-for-15 reverse stock split that was effected in March 2024, as well as the dilutive impact of recent financings completed by the company. Bernardino reasserted the Buy rating, indicating a continued positive outlook on Moleculin Biotech’s prospects despite the lowered price target. With a current market capitalization of just $3.87 million and a beta of 1.93, InvestingPro’s Fair Value analysis suggests the stock may be undervalued at current levels, despite facing challenges with an 85.92% decline over the past year. Discover detailed valuation metrics and access the comprehensive Pro Research Report, available for 1,400+ US stocks, to make more informed investment decisions.
In other recent news, Moleculin Biotech has announced several significant developments. The company has secured $3.5 million through a stock and warrant sale, with Roth Capital Partners (WA:CPAP) serving as the exclusive placement agent. Additionally, Moleculin is set to raise approximately $5.8 million from the exercise of existing warrants, facilitated by Roth Capital Partners as the financial advisor. The funds from these transactions are intended for working capital and general corporate purposes.
Moleculin has also received guidance from the U.S. Food and Drug Administration (FDA) for its Phase 3 MIRACLE trial, allowing a reduction in trial size, which aims to accelerate the approval timeline for Annamycin, a drug for acute myeloid leukemia (AML). The company has obtained the first European regulatory approval from Ukraine’s Ministry of Health to begin recruiting for this trial. Furthermore, Moleculin has reached an agreement to amend investor warrants, which includes adjusting the exercise price and aligning terms with upcoming Series C Warrants.
These developments highlight Moleculin’s ongoing efforts in advancing its clinical programs and financial strategies. Annamycin, which has received Fast Track Status and Orphan Drug Designation from the FDA, is a key focus, with the trial employing an adaptive design to evaluate its efficacy in combination with Cytarabine. The company is also advancing other drug candidates, including WP1066 and WP1122, targeting various cancers and viral indications.
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