Pluristem Therapeutics (PSTI): JV May De-risk PLX-PAD In Japan - FBR

FBR Capital analyst, Vernon Bernadino, reiterated his Outperform rating on shares of Pluristem Therapeutics (NASDAQ: PSTI) after the company announced its plan to form a new corporation (New Co.) with Sosei Corporate Venture Capital Ltd. to jointly develop and commercialize PLX-PAD cells in Japan.

A definitive agreement is expected to be finalized by the end of March. PSTI will retain all proprietary rights to PLX-PAD, and will receive 35% ownership of New Co. in exchange for providing a perpetual license to commercialize PLXPAD for the treatment of critical limb ischemia (CLI) in Japan.

The analyst expects a 75-patient clinical trial of PLX-PAD cells in CLI patients to begin in 1H17, which could provide additional PLX-PAD clinical efficacy and lead to early conditional marketing approval under an accelerated regulatory pathway for regenerative medicine that was agreed upon with Japan’s Pharmaceuticals and Medical Devices Agency (PMDA). We think this agreement significantly mitigates the risk in PLX-PAD's development in Japan.

No change to the price target of $6.

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

Shares of Pluristem Therapeutics closed at $1.55 yesterday.

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