Verastem stock rises as BTIG reiterates Buy rating on improved cancer drug data

Published 14/08/2025, 11:22
Verastem stock rises as BTIG reiterates Buy rating on improved cancer drug data

Investing.com - Verastem (NASDAQ:VSTM) shares climbed approximately 13% in after-hours trading following the release of updated clinical data for its KRAS G12D inhibitor VS-7375. The stock has shown remarkable momentum, delivering a 42.7% return in the past week and an impressive 253.3% gain over the last year, according to InvestingPro data.

The data, presented in an abstract for the upcoming WCLC 2025 conference, showed an improved overall response rate (ORR) of 58% among non-small cell lung cancer (NSCLC) patients, up from the previously reported 42% at the ASCO conference. The company maintains a strong financial position with more cash than debt on its balance sheet, though InvestingPro analysis indicates the stock is currently trading above its Fair Value.

BTIG analyst Justin Zelin highlighted a "potentially class-leading" 69% ORR at the recommended Phase 2 dose (RP2D) of 600mg, while noting that the upcoming U.S. Phase 1/2a study will include antiemetic use and dosing in a fed state to mitigate gastrointestinal adverse events. With analyst targets ranging from $13 to $20, Verastem has received strong buy recommendations, as revealed in the comprehensive Pro Research Report available on InvestingPro.

BTIG maintained its Buy rating and $20 price target on Verastem, describing VS-7375 as an "underappreciated second program" in the company’s pipeline that complements its recently approved avutometinib and defactinib treatment for low-grade serous ovarian cancer (LGSOC).

The research firm stated that the updated data "continue to affirm the asset’s potential to drive shares higher longer-term," while awaiting the conference presentation for more details on response durability and adverse events.

In other recent news, Verastem Inc. reported its financial results for the second quarter of 2025, showing a net product revenue of $2.1 million following the launch of its new cancer therapy. Despite this revenue, the company experienced a non-GAAP adjusted net loss of $41.4 million. Verastem also bolstered its financial position with a $75 million private placement. Additionally, the company announced positive updated data for its KRAS G12D inhibitor in advanced non-small cell lung cancer patients. The Phase 1/2 study conducted by its partner, GenFleet Therapeutics, in China demonstrated an objective response rate of 68.8% at the recommended Phase 2 dose for GFH375, known as VS-7375 outside of China. Across all dose levels, the drug showed a 57.7% response rate in patients with the KRAS G12D mutation. These developments reflect recent progress in Verastem’s oncology portfolio.

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