Beam Therapeutics Inc. (BEAM:NASDAQ) and Verve Therapeutics Inc. (VERV:NASDAQ) amended their existing agreement signed in April 2019 in two significant ways, reported Wedbush analyst David Nierengarten in a July 7 research note.
One, the amendment calls for Beam to grant Verve the exclusive license to a cardiovascular base editing target, and Verve will develop and commercialize a therapeutic against it. Beam may opt-in to an agreement for a 35%/65% profit share split after the final patient is dosed in the related Phase 1 trial.
"Should Beam not opt-in, it will be eligible to receive milestones and royalties under the same terms provided for the other collaboration products in the original agreement," Nierengarten explained. The economic split for those is 50%/50%.
Beam is a Massachusetts-headquartered biotech company that is developing precision genetic medicines through base editing. Verve is developing gene-editing medicines to treat cardiovascular disease.
Two, Beam gained an exclusive license from Verve for its GaINAc-lipid nanoparticle-mediated (LNP) delivery technology, which, Nierengarten noted, Beam could capitalize on for some of its own in vivo liver programs.
"Coming after Beam's acquisition of Guide Therapeutics last year, we believe that Beam continues its push into LNP delivery technologies," he added.
Nierengarten also pointed out that Verve generated data from animal testing that indicate base editing has a place in vivo applications.
"We continue to believe that Beam has additional levers of upside that could continue to drive the company's long-term value, including these collaborations around non-core therapeutic areas to maximize their platform's economic potential," he added.
As for Beam's finances, the biotech has about $1.2 billion in cash, enough, Nierengarten noted, to get it to the point of generating initial patient data regarding its core programs, and potential stock catalysts.
These programs include BEAM-101, activating fetal protein for sickle cell disease and beta-thalassemia; BEAM-102, correcting the HbS sickle mutation for sickle cell disease; and BEAM-201, silencing the CD7 chimeric antigen receptor T-cells in T-cell acute lymphoblastic leukemia and CD7-positive acute myelogenous leukemia.
Wedbush has an Outperform rating and a $100 per share price target on Beam Therapeutics. Its current share price is around $53.05.
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Disclosures for Wedbush, Beam Therapeutics, July 7, 2022
Analyst Certification: We, David Nierengarten and Dennis Pak, certify that the views expressed in this report accurately reflect our personal opinions and that we have not and will not, directly or indirectly, receive compensation or other payments in connection with our specific recommendations or views contained in this report.
Company Specific Disclosures:
1. WS makes a market in the securities of Beam Therapeutics.
3. WS co-managed a public offering of securities for Beam Therapeutics within the last 12 months.
4. WS has received compensation for investment banking services from Beam Therapeutics within the last 12 months.
5. WS provided Beam Therapeutics with investment banking services within the last 12 months.
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