Rocket Pharmaceuticals receives FDA clearance for BAG3-DCM gene therapy

CRANBURY, N.J. - Rocket Pharmaceuticals, Inc. (NASDAQ:RCKT), currently trading at $2.53 with a market capitalization of $273 million, announced Monday that the U.S. Food and Drug Administration (FDA) has cleared its Investigational New Drug (IND) application for RP-A701, a gene therapy candidate targeting BAG3-associated Dilated Cardiomyopathy (BAG3-DCM). According to InvestingPro data, five analysts have recently revised their earnings expectations upward for the upcoming period, suggesting growing confidence in the company’s pipeline.

RP-A701 is an AAVrh.74-based gene therapy designed to treat this rare, inherited heart condition characterized by progressive ventricular enlargement and impaired systolic function. The therapy represents Rocket’s third clinical-stage gene therapy candidate from its AAV cardiovascular portfolio. While the company maintains a strong liquidity position with a current ratio of 9.19 and more cash than debt on its balance sheet, InvestingPro analysis indicates the company is rapidly burning through its cash reserves.

The company plans to conduct a multi-center, dose-escalation Phase 1 clinical trial to evaluate the safety, biological activity, and preliminary efficacy of RP-A701 in adults with BAG3-DCM. Initial participants will include adults with implantable cardioverter defibrillators and advanced disease at high risk for heart failure progression.

"With programs in the clinic for each of the major types of genetic cardiomyopathies – hypertrophic, dilated, and arrhythmogenic – we are advancing our mission to bring potentially curative gene therapies to patients with rare and life-threatening cardiovascular diseases," said Kinnari Patel, President, Head of R&D and Chief Operating Officer of Rocket Pharmaceuticals.

BAG3-DCM is caused by mutations in the BAG3 gene, resulting in early-onset, rapidly progressing heart failure. The company estimates that as many as 30,000 individuals in the U.S. may be affected by this condition.

Current treatments for BAG3-DCM, including implantable devices and heart transplants, do not consistently prevent disease progression and are associated with significant complications.

Rocket Pharmaceuticals is working toward treating the first patient as Phase 1 trial start-up activities are currently underway, according to the company’s press release statement. With analyst price targets ranging from $2 to $19, investors seeking deeper insights into RCKT’s financial health and growth prospects can access comprehensive analysis through the InvestingPro Research Report, part of the platform’s coverage of over 1,400 US equities.

In other recent news, Rocket Pharmaceuticals has been the subject of several analyst downgrades and price target reductions following a setback in its clinical program for Danon disease. UBS lowered its price target to $5.00 from $12.00, citing a recent patient death in the Danon program but maintained a Buy rating, expressing cautious optimism about future data readouts. Canaccord Genuity also reduced its price target from $34 to $11, noting delays in the anticipated launch timeline for the RP-A501/Danon therapy in the U.S. and Europe. Evercore ISI downgraded the stock from Outperform to In Line, with a new price target of $5.00, due to the patient death impacting the company’s outlook.

Additionally, JPMorgan downgraded Rocket Pharmaceuticals from Overweight to Neutral, slashing the price target to $7.00 from $44.00 after a clinical hold was placed on the RP-A501 program. Goldman Sachs took a more bearish stance, downgrading the stock to Sell and reducing the price target to $2.00 from $13.00, following the FDA’s clinical hold due to severe adverse events in the trial. The firm raised concerns about the lack of earlier disclosure regarding protocol amendments and the potential impact on the drug’s commercial viability. Despite these challenges, Rocket Pharmaceuticals continues to work on resolving the issues with its clinical trials and remains focused on its gene therapy programs.

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