Batiraxcept has "Best in Class Potential" - H.C. Wainwright Reiterates Buy Rating on Aravive (ARAV) with $26 Price Target

H.C. Wainwright analyst Joseph Pantginis reiterated a Buy rating and $26.00 price target on Aravive Inc. (NASDAQ: ARAV), following the company's recent ASCO presentations.

The analyst comments: "This weekend at ASCO, Aravive presented updated interim from the Phase 1b/2 study testing batiraxcept in combination with cabozantinib in patients with ccRCC. The results as of the April 30 cutoff date continue to show encouraging response rates, PFS data, and biomarker data. Given the safety and clinical activity demonstrated by the combination, together with PK/PD data, the results support a RP2D for batiraxcept of 15 mg/kg. Recall, 100% of patients enrolled received a prior immunotherapy, 77% of the patients were in the IMDC (International Metastatic RCC Database Consortium) Risk Score of intermediate or poor, and 39% of the patients had received 2 or more prior lines of therapy prior to study entry.

We reiterate our Buy rating and $26 price target. Our valuation is based on our clinical net present value (NPV) model, which allows us to flex multiple assumptions affecting a drug's potential commercial profile. Our valuation is currently based solely on AVB-500’s contribution from ovarian cancer, based on the preclinical and clinical data in hand. We note that our current projected values for AVB-500 in ovarian cancer is based on moderate to minimal market penetration of the drug (up to a max of 23% in second line, 18% in third and 15% in first line) in a relatively uncrowded market. We believe potential upside exists as clinical data are accumulating, with the initiation of clinical studies in ccRCC and additional oncology indications. At the moment, due to the early stage of development, we do not assign value to AVB-500’s additional oncology indications (ccRCC and undisclosed). However, we view these new indications and asset as potential upside to our valuation given the high unmet need, the wide market opportunity and the relatively limited list of competitors, none of which utilizes the same target (GAS6). Factors that could impede reaching our price target include failed or inconclusive clinical trials or inability of the company to secure adequate funding to progress its drugs through the development pathway."

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

Shares of Aravive Inc. closed at $1.21 yesterday.

By Vlad Schepkov

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