In an August 5, 2022 research note, Biotechnology Technology Equity Research LLC (BTIG LLC) Analyst Yun Zhong, Ph.D. advised that Magenta Therapeutics Inc. (MGTA:NASDAQ) recently announced updates on the status of its drug development pipeline during Q2/22 and suggested that all its programs are moving forward as scheduled.
BTIG stated it is reiterating its Buy rating for the company as it sees promising potential for Magenta's pipeline in targeting hematopoietic stem cell transplant (HSCT) and gene therapy.
The analyst advised that Magenta Therapeutics is expected to report updated clinical data for its MGTA-117 and MGTA-145 in Q4/22, which will serve as key catalysts for the company.
BTIG noted that early in the Phase 1/2 MGTA-117 clinical study, four subjects in cohort 1 who were given the lowest dose of 0.02mg/kg did not experience any adverse effects and showed good target engagement and rapid clearance within 48 hours after dosing.
In an update from the company on August 4, 2022, Magenta indicated that it is seeing consistent observations from members in the higher dose cohort but did not list any additional details regarding the number of patients treated and evaluated or the specific dose escalation data.
The analyst advised that the firm's management intends to provide a clinical update in Q4/22, which BTIG believes will give credence to discussions with the FDA to move the study forward into transplant-eligible patients.
In addition, Magenta is collaborating with bluebird bio Inc. (BLUE:NASDAQ) {not rated by BTIG} in a new Phase 2 study of MGTA-145 in patients with sickle cell disease (SCD). The firm estimates that initial data from the trial will be available sometime during Q4/22.
Magenta listed in its quarterly update that as of June 30, 2022, it held $139.4 million in cash and cash equivalents on its balance sheet, which it said is sufficient to fund the company into Q2/24.
The analyst remarked that Magenta has also entered into collaboration agreements with two other companies for the purpose of developing MGTA-117 as "a nongenotoxic conditioning regimen in gene therapy and genome editing treatment."
BTIG mentioned that "it believes that the application in gene therapy should be a particularly promising opportunity for strong growth and that there should be considerable upside upon increased adoption of HSCT in indications where the procedure is not widely used despite being the only curative treatment option (i.e., autoimmune diseases and hemoglobinopathies other than SCD)."
The analyst noted that there are several upcoming catalysts that are all expected to take place in Q4/22. These include interim results from the Phase 1/2 study in patients with r/r AML or MDSEB not eligible for HSCT, discussions with the FDA related to the advancement of its CD45-antibody-drug conjugate program, clinical development plan, and schedule following the evaluation of clinical data from dose-ranging toxicology and GLP toxicology studies MGTA-145 for HSCT mobilization, and receipt of initial data from its Phase 2 trial.
BTIG stated that expects that the FDA will grant approval for MGTA-145 2026 for use in SCD patients and mentioned that there is potential upside for future approval by the FDA for the use of MGTA-145 in β-thalassemia.
The added that it also expects that the FDA will authorize the use of MGTA-117 for AML, MDS, and SCD) patients in 2026.
The analyst commented that in Q2/22, Magenta expects to engage in discussions with the FDA to map out the next steps for its CD45-antibody-drug conjugate program. The CD45-ADC program could expand the firm's pipeline as it applies in particular for use in autologous transplants for severe autoimmune diseases. The analyst listed that CD45-ADC offers strong prospects for use in the treatment of multiple sclerosis, scleroderma, leukemia, and non-Hodgkin lymphoma (NHL).
Magenta Therapeutics is a clinical-stage biotech firm focused development of medicines that are engineered to optimize the stem cell transplant process in order to improve treatment outcomes and increase patient eligibility in the transplant addressable population in the areas of genetic diseases hematologic cancer, and other additional indications.
Biotechnology Technology Equity Research advised that it has a Buy rating and a $6.00 price target for Magenta Therapeutics Inc. BTIG indicated that it arrived at that price by employing a combination of discounted earnings, cash flow, and clinical net present value (NPV) models. The research firm noted that its revenue projections include sales for both MGTA-145 and MGTA-117 for respective use in HSC mobilization and conditioning prior to HSCT.
Magenta Therapeutics shares trade on the Nasdaq Exchange under the symbol "MGTA" and last closed for trading at $1.77 on Friday, August 12, 2022. The company has approximately 58.8 million shares outstanding and a market cap of about $104.1 million.
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Disclosures for BTIG Research, Magenta Therapeutics, August 5, 2022
Analyst Certification: I, Yun Zhong, hereby certify that the views about the companies and securities discussed in this report are accurately expressed and that I have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this report.
Company–Specific Regulatory Disclosures: BTIG LLC expects to receive or intends to seek compensation for investment banking services in the next 3 months from: Magenta Therapeutics (MGTA).
Other Disclosures: Additional Information Available Upon Request.
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