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WILMINGTON, Del. - Prelude Therapeutics Incorporated (NASDAQ:PRLD), a clinical-stage precision oncology company, announced a collaboration with pharmaceutical giant Merck (NYSE:MRK) to initiate a Phase 2 clinical trial for a new cancer treatment. The study will focus on PRT3789, Prelude's investigational SMARCA2 degrader, in combination with Merck's anti-PD-1 therapy, KEYTRUDA, in patients with SMARCA4-mutated cancers.
The partnership, unveiled on Tuesday, aims to leverage the complementary mechanisms of the two drugs to potentially enhance anti-tumor activity. "Through this collaboration, we may have the potential to positively impact clinical outcomes in patients harboring a SMARCA4 mutation, who have previously been known to have limited treatment options," said Jane Huang, M.D., President and Chief Medical Officer of Prelude.
PRT3789 is currently in Phase 1 clinical development, with enrollment on track and the monotherapy dose escalation expected to conclude mid-2024. The objectives of this initial study are to establish the safety and tolerability profile of PRT3789 as both monotherapy and in combination with docetaxel, evaluate activity, and determine a recommended Phase 2 dose.
The decision to advance to a Phase 2 trial is supported by pre-clinical data presented at the 2023 AACR International Conference on Molecular Targets and Cancer Therapeutics, which showed enhanced anti-tumor immunity and tumor regressions when combining a SMARCA2 degrader with an anti-PD-1 mAb in SMARCA4-mutated cancers.
Under the terms of the agreement, Merck will supply KEYTRUDA to Prelude, which will sponsor the clinical trial. Both companies retain all commercial rights to their respective compounds, whether as monotherapy or in combination therapies.
Prelude's diverse pipeline includes other candidates in clinical development, such as a potent CDK9 inhibitor and a next-generation CDK4/6 inhibitor. The company is also developing an orally bioavailable SMARCA2 degrader and collaborating with AbCellera to discover and develop precision antibody drug conjugate products.
In other recent news, Prelude Therapeutics has seen a shift in analyst sentiment as Barclays downgraded the company's stock from Equalweight to Underweight, setting a new price target of $3.00. This downgrade is based on comparative analysis within Barclays' coverage universe, suggesting the firm expects Prelude's stock to underperform relative to other companies in its sector.
Simultaneously, Prelude Therapeutics has been making significant strides in the biotechnology sector, particularly in the development of novel cancer therapies.
The company is currently advancing two key programs, SMARCA2 and CDK9, through clinical trials. The SMARCA2 degrader, PRT3789, is expected to select its phase 2 dose by mid-2024, while PRT2527, a CDK9 inhibitor, has demonstrated improved kinase selectivity and potency in preclinical studies.
Despite reporting no revenues, Prelude ended the first quarter of 2024 with about $201.9 million in cash and equivalents, indicating a stable financial position with a cash runway extending into 2026. Prelude's strategic partnership with AbCellera, focusing on the development of antibody-drug conjugates utilizing SMARCA degraders, stands out as a significant move in enhancing its drug development capabilities.
InvestingPro Insights
As Prelude Therapeutics Incorporated (NASDAQ:PRLD) embarks on its Phase 2 clinical trial in partnership with Merck, investors and stakeholders are closely monitoring the company's financial health and stock performance. According to real-time data from InvestingPro, Prelude Therapeutics holds a market capitalization of $189.51 million. The company's stock price has been subject to volatility, with a 1-week price total return of -7.51% and a 1-year price total return of -21.77%.
InvestingPro Tips suggest that while the company holds more cash than debt on its balance sheet, indicating a solid liquidity position, it is also quickly burning through cash. This could be a point of concern for investors considering the long-term sustainability of Prelude's operations. Additionally, analysts have revised their earnings upwards for the upcoming period, which could signal optimism about the company's future performance despite not being profitable over the last twelve months.
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