Leap Therapeutics stock hits 52-week low at $0.4 amid sharp decline

Leap Therapeutics Inc . (NASDAQ:LPTX) shares have tumbled to a 52-week low, touching down at $0.4. This latest price level reflects a stark downturn for the biotech firm, which has seen its stock value erode significantly over the past year, with a YTD decline of 85%. InvestingPro analysis indicates the stock is currently in oversold territory, with additional technical indicators available to subscribers. Investors have witnessed a precipitous drop in the company’s market valuation to $15.7 million, with Leap Therapeutics experiencing an 83% plunge from its position one year ago. The decline to this 52-week low underscores the challenges faced by the company in a competitive and rapidly evolving sector, where investor confidence can be heavily influenced by clinical trial outcomes, regulatory hurdles, and market dynamics. The company’s financial health score on InvestingPro is currently rated as WEAK, with concerning cash burn rates and profitability metrics that subscribers can access in detail.

In other recent news, Leap Therapeutics announced positive initial data from its DeFianCe study for advanced colorectal cancer (CRC), highlighting a higher objective response rate when its drug sirexatamab is combined with bevacizumab and chemotherapy. The study demonstrated a 35% objective response rate in the experimental arm compared to 23% in the control arm, with potential for a biomarker-driven approach due to the correlation between DKK1 levels and clinical activity. However, the company also reported that its DisTinGuish study in gastric cancer did not meet the necessary criteria to proceed to Phase 3, leading Leap Therapeutics to discontinue plans for further studies in this area.

Following these developments, H.C. Wainwright downgraded Leap Therapeutics’ stock rating from Buy to Neutral, citing concerns over the drug’s market potential and the company’s financial position. Similarly, Baird adjusted its rating from Outperform to Neutral and significantly reduced the price target to $1.25, reflecting concerns over ambiguous survival data and financial outlook. Despite the setback in gastric cancer, Leap Therapeutics plans to focus on CRC and is considering strategic partnerships to advance sirexatamab in other indications.

The company remains optimistic about the CRC data and is preparing for a Phase 3 study targeting second-line CRC patients with specific biomarker profiles. Leap Therapeutics’ management is also in discussions with the FDA about a regulatory pathway, although further development steps are required. These recent developments have prompted a cautious stance from analysts, reflecting the complexities and challenges in Leap Therapeutics’ current strategic direction.

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