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On Tuesday, UBS analyst Trung Huynh adjusted the price target on Cabaletta Bio Inc . (NASDAQ:CABA) shares, reducing it to $7.00 from the previous $10.00, while still holding a Buy rating on the stock. The adjustment followed Cabaletta Bio’s fourth quarter 2024 earnings report, which was in line with expectations and did not present any financial surprises. The stock, currently trading at $1.38, has experienced significant pressure, falling over 90% in the past year. According to InvestingPro data, analyst targets for the stock range from $3 to $28, with a consensus recommendation leaning strongly toward Buy.
The main point of interest from the company’s recent press release, according to the analyst, was the report of a new Grade 3 immune effector cell-associated neurotoxicity syndrome (ICANS) case. This adverse event occurred after a patient in the RESET-SSc trial received treatment with Cabaletta’s investigational therapy, despite having a fever prior to infusion—a deviation from the trial protocol. While the company faces clinical challenges, InvestingPro analysis shows it maintains a strong liquidity position with a current ratio of 8.11 and more cash than debt on its balance sheet.
The patient who experienced the Grade 3 ICANS did not suffer from cerebral edema, seizures, or motor dysfunction, and the event was resolved following treatment with dexamethasone. Grade 3 ICANS events are significant adverse effects associated with CAR-T therapies, and the Independent (LON:IOG) Data Monitoring Committee (IDMC) recommended that the trial continue at the current dosage. This outcome has provided some reassurance that the issue may be more related to the protocol deviation rather than the investigational therapy itself.
In response to the adverse event, Cabaletta Bio has implemented additional precautions for its trial. Investigators are now required to confirm that patients have not had a fever or infection in the two weeks prior to receiving the therapy. This new measure aims to reduce the likelihood of further ICANS cases.
UBS continues to closely monitor the incidence of ICANS cases, given the critical importance of safety in the development of treatments for autoimmune diseases. The firm’s maintained Buy rating indicates a positive outlook on Cabaletta Bio’s stock despite the reduced price target. Based on InvestingPro Fair Value analysis, the stock appears undervalued at current levels, though investors should note that seven analysts have recently revised their earnings expectations downward. For deeper insights into Cabaletta Bio’s financial health and growth prospects, including 15+ additional ProTips and comprehensive valuation metrics, subscribers can access the full Pro Research Report.
In other recent news, Cabaletta Bio Inc. has been the focus of attention due to developments in its clinical trials and stock evaluations. Stifel analysts have adjusted their outlook on the company by reducing the stock’s price target to $13, down from $26, while maintaining a Buy rating. This revision follows Cabaletta Bio’s earnings report and the emergence of a new case of high-grade ICANS, raising concerns about the safety of CAR-T therapies in autoimmune diseases. Despite these challenges, Stifel remains optimistic about the company’s potential, citing insights from phase 1 trials that could improve patient selection and reduce toxicity.
Meanwhile, H.C. Wainwright has reaffirmed its Buy rating and $25 price target for Cabaletta Bio, highlighting recent progress in patient enrollment for its RESET trials. The company has accelerated enrollment, with 21 patients now participating across 44 clinical sites in the U.S. and Europe, up from 16 patients in November. This advancement positions Cabaletta Bio to potentially dose one patient per week, suggesting a significant amount of data could be available by the American College of Rheumatology meeting in November. H.C. Wainwright’s continued confidence reflects the potential impact of increased enrollment on the drug’s clinical trials and the company’s overall trajectory.
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