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On Thursday, H.C. Wainwright adjusted its outlook on PolyPid Ltd. (NASDAQ:PYPD) shares, reducing the price target to $11.00 from the previous $14.00, while reaffirming a Buy rating on the stock. The company, currently valued at $20.21 million, has seen its shares decline by 15.14% over the past week.
According to InvestingPro analysis, the stock is currently trading near its Fair Value, with analyst targets ranging from $10 to $14. The revision follows an announcement made earlier in the week regarding the SHIELD II Phase 3 trial of D-PLEX100, PolyPid's product aimed at preventing surgical site infections (SSIs) in patients undergoing abdominal colorectal surgery.
The independent Data Safety Monitoring Board (DSMB) recommended concluding the SHIELD II study upon reaching an enrollment of 800 patients, which is the lowest sample size reassessment stop after the minimum planned number of 624 patients. This recommendation came after the DSMB reviewed unblinded efficacy data from the first 430 enrolled subjects. At this stage, the DSMB could have also advised stopping the trial due to futility or overwhelming efficacy or altering the sample size up to a maximum of 1,100 patients.
As of earlier this week, the study had enrolled 630 patients, with the completion of the remaining 170 patient enrollments anticipated in the first quarter of 2025. PolyPid is now expecting to report top-line results from the trial in the second quarter of 2025. Should the Phase 3 data be positive, the company plans to proceed with a rolling New Drug Application (NDA) submission to the FDA for D-PLEX100 in the third quarter of 2025, aiming to complete it by year's end.
Considering D-PLEX100 has been granted Fast Track and Breakthrough Therapy Designation by the FDA, PolyPid anticipates that the NDA, once accepted, would be eligible for Priority Review. InvestingPro data reveals the company maintains a Fair financial health score, though it's currently burning through cash rapidly.
With the next earnings report due on February 5, 2025, investors seeking deeper insights can access comprehensive analysis and 12 additional ProTips through InvestingPro's detailed research reports, available for over 1,400 US stocks. This could potentially lead to an FDA approval decision in the first half of 2026. If approved, PolyPid expects to launch D-PLEX100 in the U.S. market in 2026.
The analysts at H.C. Wainwright view the interim analysis findings as positive and aligned with a base-case scenario. Despite the reduced price target, they maintain a positive stance on PolyPid shares, attributing the adjustment to dilution concerns.
In other recent news, PolyPid Ltd., an Israel-based biopharmaceutical company, has entered into a research and development pact with ImmunoGenesis, Inc., a U.S. clinical-stage biotech firm. The collaboration aims to develop novel treatments for solid tumors using PolyPid's proprietary PLEX technology and ImmunoGenesis's STING agonist drug candidate. This partnership is an attempt to address the rapid clearance challenges associated with potent STING agonists, potentially enhancing their effectiveness in the tumor microenvironment.
In addition to this, PolyPid disclosed the progress of its SHIELD II pivotal trial for D-PLEX100 and its current financial status during its recent Q3 earnings call. The trial, which aims to prevent surgical site infections in colorectal surgeries, has enrolled approximately 550 subjects, with full enrollment anticipated by December 2024. PolyPid reported a cash position of $9.5 million, sufficient to fund operations into early 2025, and the potential for additional funding through private placement financing.
However, the company experienced a net loss of $7.8 million for the quarter, primarily due to rising research and development expenses. Despite these financial challenges, PolyPid continues to work on strategic partnerships for U.S. commercialization of D-PLEX100 and potential market expansion into South America and Asia.
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