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Investing.com - Praxis Precision Medicines Inc . (NASDAQ:PRAX), a $1.12 billion market cap biotech company, has received Breakthrough Therapy Designation (BTD) from the FDA for relutrigine, the company announced Thursday. The designation applies to the novel sodium channel modulator for treating pediatric patients with SCN2A and SCN8A developmental and epileptic encephalopathies (DEEs). According to InvestingPro analysis, the stock appears undervalued at current levels, trading at $54.94.
H.C. Wainwright reiterated its Buy rating on Praxis stock with a $105.00 price target following the announcement. The stock has shown strong momentum, gaining 8.71% in the past week, though InvestingPro data indicates it may be overbought. The firm noted that while investor focus has primarily been on the upcoming vormatrigine RADIANT study results in focal onset seizures, relutrigine’s potential is gaining recognition. With 12 additional ProTips available, subscribers can access deeper insights into PRAX’s financial health and market position.
The efficacy demonstrated by relutrigine in the EMBOLD study showed a placebo-adjusted monthly motor seizure reduction of 46% during the double-blind period, with seizure freedom achieved in over 30% of patients. The study also recorded improvements in alertness, communication, and seizure severity as reported by clinicians and caregivers.
At the 11-month mark, patients experienced an average seizure reduction of approximately 90%, with a mean of 67 days without seizures compared to just three days during the baseline period.
H.C. Wainwright suggested that relutrigine’s commercial potential in DEEs might exceed vormatrigine’s potential in focal onset seizures, describing the EMBOLD study results as "potentially paradigm-shifting" in offering seizure freedom to patients.
In other recent news, Praxis Precision Medicines has received a breakthrough therapy designation from the U.S. Food and Drug Administration for its investigational drug relutrigine, intended for pediatric patients with SCN2A and SCN8A developmental and epileptic encephalopathies. This designation aims to expedite the drug’s development and regulatory review, supported by positive data from the Phase 2 EMBOLD study. Praxis has also launched the EMERALD study to evaluate relutrigine across all developmental and epileptic encephalopathies. Additionally, the company has entered a quiet period before releasing topline results from the RADIANT Phase 2 study, expected by mid-2025.
In related developments, Piper Sandler has reiterated an Overweight rating on Praxis, noting the company’s expectations for significant seizure reduction in the RADIANT trial. Oppenheimer has assumed coverage with an Outperform rating, highlighting Praxis’s financial stability and potential milestones in its pipeline. The company’s financial results for the first quarter of 2025 included operating expenses of $74.7 million and cash reserves of $472 million, expected to support operations through 2028. Meanwhile, the Prax Group, unrelated to Praxis Precision Medicines, has entered insolvency proceedings, affecting its Lindsey oil refinery and associated assets.
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