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On Tuesday, Rodman & Renshaw analyst Tony Blair reaffirmed a Buy rating and a $4.00 price target on Compugen Ltd . (NASDAQ:CGEN). Blair highlighted the company’s latest business updates, which were released before the market opened. Compugen (TASE:CGEN) reported a cash balance of $103.3 million at the end of the fourth quarter of 2024, which is projected to fund operations into 2027.
The company is gearing up to initiate a pivotal trial in the second quarter of 2025, focusing on COM701 as a monotherapy for patients with platinum-sensitive ovarian cancer. The trial will involve 60 patients who are ineligible for current treatments such as a PARP inhibitor or bevacizumab. They will be randomized to receive either COM701 or a placebo. Compugen anticipates interim data from this study to be available in the second half of 2026. With a gross profit margin of 84.5% and minimal debt-to-equity ratio of 0.05, the company appears well-positioned to execute its clinical programs.
This decision to proceed with the trial was based on data presented at the 2024 Society for Immunotherapy of Cancer (SITC) meeting. Compugen is also monitoring the progress of two of its licensed programs. The first, rilvegostomig, a bispecific antibody for lung and gastrointestinal cancers, is in Phase 3 studies. Compugen has licensed this drug to AstraZeneca (NASDAQ:AZN) and stands to receive milestone payments and royalties upon approval. Interim data from these studies is expected in 2025.
The second program, GS-0321 (formerly COM503), is an anti-IL18BP antibody for the treatment of solid tumors, which has been licensed to Gilead Sciences (NASDAQ:GILD). The clinical trial for GS-0321 has commenced, with the first patient dosed in the first quarter of 2025. Compugen continues to demonstrate a commitment to advancing its pipeline and potentially benefiting from its partnerships with larger pharmaceutical companies.
In other recent news, Compugen Ltd. reported its fourth-quarter 2024 earnings, revealing a significant shortfall in both earnings per share (EPS) and revenue compared to market forecasts. The company posted an EPS of -$0.07, missing the expected $0.02, and reported revenue of $1.47 million, falling short of the $11.66 million forecast. Annual revenues decreased to $27.9 million from $33.5 million in 2023, marking a decline in overall performance for the year. Despite these challenges, Compugen maintains a strong cash position, with a balance of $103.3 million as of December 31, 2024, indicating financial stability for ongoing operations.
In other developments, Compugen continues to advance its clinical programs, particularly in oncology, leveraging partnerships with Gilead and AstraZeneca. The company received a $30 million milestone payment from Gilead for achieving FDA IND clearance for GS0321, a potential first-in-class anti-IL-18 binding protein antibody. Additionally, AstraZeneca initiated two Phase 3 trials evaluating combinations of risvergastomid, a PD-1/TIGIT bispecific derived from Compugen’s COM902, with promising efficacy and safety profiles. These trials represent a significant potential revenue source for Compugen, as the company is eligible for future milestone payments and royalties on sales.
Analysts have expressed concerns about Compugen’s future revenue prospects due to the earnings miss, but the company’s strategic focus on advancing its clinical pipeline remains strong. Compugen’s guidance for future quarters suggests continued challenges, with EPS forecasts remaining negative through 2025. However, the company plans to advance its clinical trials, including a key study in ovarian cancer, and expects interim results in the second half of 2026. These recent developments highlight Compugen’s commitment to innovation and strategic collaborations to drive future growth.
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