Piper Jaffray Upgrades Geron Corporation (GERN) to Overweight

Piper Jaffray upgraded Geron Corporation (NASDAQ: GERN) from Neutral to Overweight with a price target of $5.00. Yesterday Geron Corp announced that the company has entered into an exclusive worldwide license and collaboration agreement with Janssen Biotech, Inc. to develop and commercialize, imetelstat, Geron's telomerase inhibitor product candidate for oncology.

Analyst Charles C. Duncan said, "The deal brings a $35M upfront which should largely fund Geron's 50% obligation for the first MF and MDS Phase IIs. Additionally, Geron can earn up to $900M in the upfront and success-based payments for development, regulatory, and commercial progress (>50% pre-commercial) and the company retains certain co-promote options for the U.S."

"In our view, the partnership not only provides needed external validation for imetelstat but it also reduces execution risk both in terms of clinical development and commercialization, while also broadening the potential for the drug due to greater financial and human resources. We are raising our rating to Overweight as we have lowered our discount rate from 25% to 20% and revised our valuation model to reflect a possible royalty structure, resulting in a new $5 price target.," he added.

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

Shares of Geron Corporation closed at $2.31 yesterday.

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