Summit stock remains Buy as ivonescimab shows potential in areas KEYTRUDA can't address

On Tuesday, H.C. Wainwright maintained a Buy rating on Summit Therapeutics plc (NASDAQ:SMMT) with a $16.00 price target. The firm's stance comes in light of recent developments from Merck & Co., which announced the termination of two clinical trials involving KEYTRUDA, their anti-PD-1 therapy.

The first halted trial was the Phase 3 KEYNOTE-867, aimed at treating Stage I/II non-small cell lung cancer with KEYTRUDA in combination with stereotactic body radiotherapy, which was stopped due to elevated adverse events and related deaths. The second, the KEYNOTE-630 Phase 3 trial for the adjuvant treatment of high-risk, locally advanced cutaneous squamous cell carcinoma following surgery and radiation, was discontinued due to futility.

These cancellations contribute to a growing list of over 220 trials involving KEYTRUDA that have been terminated. This underscores the challenges KEYTRUDA faces in addressing certain oncology indications effectively. According to the analyst, this presents potential opportunities for Summit's ivonescimab to be utilized in areas where KEYTRUDA has shown ineffectiveness.

In support of ivonescimab's potential, reference was made to Summit's recent press release for the HARMONi-2 top line data, where ivonescimab "decisively beat" KEYTRUDA in a head-to-head study for first-line treatment of non-small cell lung cancer (1L NSCLC).

The firm believes that ivonescimab not only has the potential to penetrate new areas within oncology but also to possibly replace KEYTRUDA as the standard of care, should future data continue to demonstrate a superior profile for ivonescimab.

As the market anticipates further clinical data releases regarding ivonescimab, H.C. Wainwright reaffirms its positive outlook on Summit Therapeutics with a reiterated Buy rating and a 12-month price target of $16.00. This endorsement reflects the firm's confidence in ivonescimab's prospects amidst the backdrop of KEYTRUDA's trial discontinuations.

In other recent news, Summit Therapeutics has been the focus of several financial firms due to the potential of its lead asset, ivonescimab. H.C. Wainwright initiated coverage with a Buy rating, citing the drug's promising early comparisons to existing treatments.

Similarly, Citi reaffirmed its Buy rating, highlighting upcoming clinical trial presentations as key catalysts. Stifel also raised the price target for Summit Therapeutics, reflecting a more optimistic outlook for ivonescimab.

In addition, Summit Therapeutics reported changes in its board of directors and the results of its annual shareholders' meeting. Ujwala Mahatme, a board member, resigned to focus on other professional commitments. At the annual meeting, all eight director nominees were elected to serve another year, and PricewaterhouseCoopers LLP was appointed as the independent auditor for the fiscal year ending December 31, 2024.

These are recent developments that offer a snapshot of the company's current status and future prospects. As Summit Therapeutics continues to make strides with ivonescimab, investors and the medical community are eagerly anticipating further updates, particularly the comparative data between ivonescimab and Keytruda in treating non-small cell lung cancer.

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