In a March 17 research note, ROTH Capital Partners analyst Zegbeh Jallah presented the events that could positively impact Turning Point Therapeutics Inc.'s (TPTX:NASDAQ) stock in 2020. The biopharma is working to design and develop small molecule tyrosine kinase inhibitors (TKIs) for use in the treatment of various oncology indications, singularly or in combinations.
The next anticipated catalyst is preclinical updates on combinations with repotrectinib (Turning Point's lead drug candidate) and TPX-0131, an anaplastic lymphoma kinase inhibitor, noted Jallah. Turning Point will present these sometime in Q2/20. It was slated to do so at the annual American Association for Cancer Research meeting, but that was cancelled.
"Although seemingly less significant, we believe that these updates are going to be very important for Turning Point," Jallah commented. This is because "the preclinical combination data for repotrectinib should allow for life cycle management and the opportunity to develop combinations that can lead to even more durable responses."
Regarding TPX-0131, the preclinical data and the inhibitor's potential 2021 move into the clinic should expand the company's pipeline and strengthen Turning Point's position in the tyrosine kinase inhibitor (TKI) space.
Also toward that end, the company hired Dr. Siegfried Reich as executive vice president and chief scientific officer, Jallah pointed out. Yet, despite Reich's wealth of experience, "the market hasn't given Turning Point much credit for his hire. We expect that with time, his value add will become even more obvious."
Jallah indicated that two catalysts are expected in H2/20. A "major" one for the biopharma is release of interim data from the pivotal Phase 2 TRIDENT trial of repotrectinib in patients with ROS1/NTRK+ solid tumors. Enrollment for it is underway, with 40% of the sites already active. If the data from this study are positive, the development and review process should be expedited because Turning Point has fast track status for patients with ROS1+ advanced nonsmall cell lung cancer patients pretreated with platinum-based chemotherapy and a ROS1 TKI.
Also, Turning Point is expected to announce interim data for TPX-0022, a MET/CSF1R/SRC inhibitor and its second clinical program. Jallah highlighted that TPX-0022 is "one of the most potent mesenchymal to epithelial transition (MET) inhibitors" and the first with a macrocyclic structure that targets MET/CSF1R/SRC kinases at the same time. These differentiating features afford TPX-0022 a strong competitive advantage, particularly over certain MET inhibitors such as capmatinib (Novartis) and tepotinib (Merck) that are in development for treatment of patients with solid tumors with genetic MET alterations.
Finally, Jallah noted that the California company ended full-year 2019 with $409 million in cash, cash equivalents and marketable securities.
ROTH has a Buy rating and a $65 per share target price on Turning Point, the stock of which is trading now at about $33.03 per share.
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Disclosures from ROTH Capital Partners, Turning Point Therapeutics Inc., Company Note, March 17, 2020
Regulation Analyst Certification ("Reg AC"): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.
ROTH makes a market in shares of Turning Point Therapeutics. Inc. and as such, buys and sells from customers on a principal basis.
ROTH Capital Partners, LLC expects to receive or intends to seek compensation for investment banking or other business relationships with the covered companies mentioned in this report in the next three months.
