Buy Broader Gene Therapy Group on Weakness Related to Celadon (CLDN) Failure, BMO Says (AGTC) (BLUE) (SGMO) (QURE)

BMO Capital analyst Jim Birchenough said they would be buyers of Acacia Research (NASDAQ: ACTG), bluebird bio (NASDAQ: BLUE), uniQure (NASDAQ: QURE) and Sangamo Biosciences (NASDAQ: SGMO) on weakness related to Celadon Group (NASDAQ: CLDN) MYDICAR failure in the phase 2b CUPID 2 study trial. The analyst said the failure was in line with their expectations.

Birchenough commented, "Failure of CUPID2 is in line with our expectations from our recent initiation and unlikely to support any further development of the MYDICAR SERCA2a gene therapy in heart failure. Based on these results, we believe that likelihood of MYDICAR success in other CV indications, like AV-Fistula maturation failure, is unlikely and CLDN will need to work rapidly to preserve cash for pre-clinical programs. Extrapolation of failure to other gene therapy players is misplaced, however, given complexity heart failure and more clear-cut etiology for other gene therapy targets, and we would be buyers of AGTC, BLUE, SGMO, and QURE on weakness."

The firm slashed its price target on CLDN to $3 (from $15), while maintaining a Market Perform rating.

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