Jefferies Upgrades Instil Bio, Highlighting Potential of SYN2510 in Cancer Treatment
Jefferies has recently upgraded Instil Bio, shifting its stance from Hold to Buy with a price target of $52, indicating a significant upside from its previous target of $11. This optimistic outlook is largely driven by the potential of Instil Bio's investigational cancer drug, SYN2510, which is part of the PD-(L)1xVEGF class. The PD-(L)1xVEGF class has been a focal point of interest, with Jefferies estimating its market potential to exceed $40 billion, akin to the PD-(L)1 class.
Clinical Trial Updates and Market Impact
The upgrade comes on the heels of Summit Therapeutics' Phase 3 HARMONi-2 trial data for ivonescimab, which demonstrated a statistically significant improvement in progression-free survival compared to monotherapy with Merck & Co Inc's Keytruda (pembrolizumab). This development not only sparked industry buzz but also led to a notable increase in stock prices for Summit Therapeutics, BioNTech SE, and Instil Bio, with the latter experiencing a surge of approximately 500%.
Future Catalysts and Industry Optimism
Looking ahead, Jefferies analyst Kelly Shi anticipates continued excitement in the PD-(L)1xVEGF space, driven by two key upcoming catalysts: the overall survival data from the Ivonescimab HARMONi-2 trial, expected by the end of 2025 or early 2026, and the first global Phase 3 data, anticipated in mid-2025. Shi expects positive results from these trials to further attract business development interest in this drug class.
SYN2510's Promising Role
SYN2510, a PD-L1xVEGF bispecific antibody, is being developed in collaboration with ImmuneOnco Biopharmaceuticals (Shanghai) for front-line non-small cell lung cancer and front-line triple-negative breast cancer. Its global registrational strategy, announced in September, positions SYN2510 as a promising contender in its field, with significant potential driven by clinical data updates and the growing business development interest in the PD-(L)1xVEGF class.
Market Confidence and Strategic Deals
The confidence in SYN2510's mechanism of action is further bolstered by strategic deals in the industry, including BioNTech's Biotheus deal for BNT327 and Merck's LM-299 deal. These developments, along with three deals in 2024 totaling an upfront of $1.4 billion and a deal value of $6.4 billion, underscore the industry's belief in the potential of the PD-(L)1xVEGF class.
Conclusion
Jefferies' upgrade of Instil Bio reflects a broader industry optimism towards the PD-(L)1xVEGF class and, specifically, the potential of SYN2510 in revolutionizing cancer treatment. With significant clinical trial updates on the horizon and a robust strategic partnership, Instil Bio is poised for a transformative impact on the pharmaceutical landscape.
