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Investing.com - Leerink Partners raised its price target on Zai Lab (NASDAQ:ZLAB) to $75.00 from $73.00 while maintaining an Outperform rating following positive Phase III trial results from the company’s partner Amgen (NASDAQ:AMGN). The biopharmaceutical company, currently valued at $3.84 billion, has seen its stock surge over 100% in the past year. According to InvestingPro data, analysts maintain a Strong Buy consensus with price targets ranging from $38.20 to $73.00.
The price target increase comes after Amgen announced Monday that its Phase III FORTITUDE-101 study evaluating bemarituzumab in combination with chemotherapy in first-line FGFR2b-positive gastric cancer met its primary endpoint, demonstrating a statistically significant and clinically meaningful overall survival benefit compared to placebo plus chemotherapy. This development comes as Zai Lab demonstrates strong revenue growth, with a 43.72% increase in the last twelve months.
Zai Lab, which holds Greater China rights to bemarituzumab, participated in the study and plans to submit for regulatory approval in China as soon as possible based on these positive results. Detailed data from the trial will be presented at a future medical meeting.
A second Phase III trial, FORTITUDE-102, which evaluates bemarituzumab plus chemotherapy and nivolumab, is ongoing with topline data expected in the second half of 2025. These results could further define the role of bemarituzumab in first-line gastric cancer treatment.
Leerink Partners maintains its positive view on Zai Lab, citing the company’s broad pipeline of commercial and development-stage assets and its management team’s extensive experience in the biopharmaceutical landscape in China and beyond. InvestingPro analysis shows the company maintains a strong financial position with more cash than debt and liquid assets exceeding short-term obligations. For deeper insights into Zai Lab’s financial health and growth prospects, including exclusive ProTips and comprehensive analysis, check out the full Pro Research Report available on InvestingPro.
In other recent news, Cantor Fitzgerald has reiterated its Overweight rating on Zai Lab, emphasizing the potential of the company’s ZL-1310 treatment for extensive stage small cell lung cancer. Recent data from the American Society of Clinical Oncology conference has bolstered confidence in ZL-1310, which showed an objective response rate of 60-70%, compared to a competitor’s 35-40%. Analysts at Cantor Fitzgerald suggest that ZL-1310 could become a significant revenue generator, potentially achieving sales of $1-2 billion. Additionally, discussions with Zai Lab’s COO and Investor Relations in New York highlighted the company’s stability amidst geopolitical tensions. Cantor Fitzgerald believes that Zai Lab is unlikely to face delisting from U.S. exchanges, due to its strong corporate structure and exemption from the Holding Foreign Companies Accountable Act. The analyst’s outlook remains positive, expecting Zai Lab to reach profitability by the fourth quarter of 2025. Despite recent market pressures from U.S.-China tariffs, Zai Lab’s core operations in China remain unaffected. The firm sees potential licensing advantages for Zai Lab as a result of the ongoing trade tensions.
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