In a May 14 research note, ROTH Capital Partners analyst Zegbeh Jallah reported that aTyr Pharma Inc. (LIFE:NASDAQ), in its Q1/21 updates call, "reaffirmed the timing of two key catalysts that has us continuously recommending 'buy.'"
Jallah reviewed these upcoming events. ROTH has a $20 per share target price on the stock, and its current share price is about $3.95.
The nearest catalyst, expected in Q3/21, is topline results for the Phase 2 trial of ATYR1923, aTyr's lead candidate in pulmonary sarcoidosis.
The data readout "should be a major catalyst," Jallah wrote, and "could support further development in other [interstitial lung diseases], to become a blockbuster opportunity." Positive results would support advancing ATYR1923 to a pivotal Phase 3 trial in 2022.
The analyst noted that about 200,000 people in the U.S. have pulmonary sarcoidosis, and the current treatment is steroids, known for causing toxic side effects and long-term comorbidities. Were ATYR1923 to be proven effective, it could eliminate steroid use in this indication.
The ongoing Phase 2 study is evaluating ATYR1923 with six monthly doses (1, 3 and 5 milligrams per kilogram versus placebo) in 37 patients with pulmonary sarcoidosis. The trial's primary endpoint is safety and tolerability. However, it also allows for collection of data regarding changes in biomarkers and steroid-tapering effects of the drug at week 24.
"We also remain bullish on this readout based on aTyr's recent study that showed ATYR1923's ability to decrease key inflammatory cytokines, including cytokines known to play a role in Sarcoidosis," Jallah commented.
Jallah also noted that aTyr's partner Kyorin Pharmaceutical is conducting a Phase 3 bridging study of ATYR1923 in Japan.
The second catalyst on the horizon, Jallah relayed, is filing an investigational new drug application for ATYR2810, aTyr's first NRP2 antibody, in solid tumors. The biopharma remains on track to submit it in Q4/21.
Two findings to date regarding ATYR2810 are significant, Jallah highlighted. One is that it can downregulate epithelial-mesenchymal transition genes, which can increase sensitivity to chemotherapy in triple negative breast cancer and nonsmall cell lung cancer, associated with poor prognosis. This is important because resistance to chemotherapy, the standard of care, is an increasing problem. Also, ATYR2810 has been shown preclinically to work synergistically with bevacizumab, and thus likely would similarly interact with checkpoint inhibitors.
"This program is expected to significantly boost the valuation," Jallah wrote. "Very few are perhaps even aware of aTyr's robust discovery engine, and success here could support a full pipeline rollout."
Along those lines, aTyr's subsidiary in Hong Kong, Pangu BioPharma, recently received milestone payments to help fund building aTyr's NRP2 bispecific antibody platform.
ROTH has a Buy rating on aTyr.
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Disclosures from ROTH Capital Partners, aTyr Pharma, Company Note, May 14, 2021
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 aTyr Pharma and as such, buys and sells from customers on a principal basis.
Shares of aTyr Pharma may be subject to the Securities and Exchange Commission's Penny Stock Rules, which may set
forth sales practice requirements for certain low-priced securities.
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.
