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Oncothyreon (ONTY) Price Target Lowered to $3 at Wedbush

August 19, 2014 8:41 AM EDT
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Price: $1.21 --0%

Rating Summary:
    7 Buy, 2 Hold, 1 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 13 | Down: 11 | New: 11
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Wedbush maintained an Outperform rating on Oncothyreon (NASDAQ: ONTY) and lowered its price target to $3.00 (from $6.00). Yesterday it was learned that randomized Phase 1/2 study, EMR 63325-009, of tecemotide compared to placebo in Japanese patients with Stage III non-small cell lung cancer did not meet its primary endpoint of an improvement in overall survival, and no treatment effect was seen in any of the secondary endpoints (progression free survival, time to progression or time to failure).

"The study failure raises doubts about the value of ONTY’s ONT-10 program (which targets the same MUC1 protein), and we are increasing our discount rate associated with it. ONTY is also planning to initiate a Phase Ib study of ONT-10 with varlilumab from Celldex (CLDX, OUTPERFORM). We note that ONT-10 improves upon tecemotide by having a larger glycosylated fragment of the MUC1 protein which induces both a T-cell and antibody response (tecemotide activates a T-cell response only) and by containing an improved and fully synthetic adjuvant. Testing in animal models has provided evidence of improved activity with ONT-10, with greater anti-tumor activity observed with ONT-10 than with a smaller non-glycosylated MUC1 peptide vaccine that resembles tecemotide," said analyst David M. Nierengarten.

"While we are removing tecemotide from our valuation, we are adding the opportunity for ONTY’s newly acquired protocell technology in primary hyperoxaluria type 1 (PH-1). Protocell technology, gained as part of the recent Alpine Biosciences acquisition, provides ONTY with a large molecule delivery platform that expands its capabilities into the rare disease space (which has less development risk). We believe protocells can be used to treat the underlying genetic defect by delivering the normal liver peroxisomal enzyme AGXT enzyme into patients, but due to its early status we are heavily discounting the program," he added.

For an analyst ratings summary and ratings history on Oncothyreon click here. For more ratings news on Oncothyreon click here.

Shares of Oncothyreon closed at $2.78 yesterday.



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