FDA Approves New Oncology Drug for Clinical Trials
Research Report

Ideaya Biosciences Inc.'s (IDYA:NASDAQ) investigative compound, GSK101 (IDE705), was greenlighted by the U.S. Food and Drug Administration for clinical testing, reported Wedbush analyst Dr. Robert Driscoll in an Aug. 21 research note. Upon clearance of the investigational new drug application, Ideaya received a $7 million ($7M) milestone payment from its collaboration partner, GlaxoSmithKline (GSK).

"We continue to believe GSK101 is a compelling program with clear clinical paths that could provide significant upside to our Ideaya estimates," Driscoll wrote.

Offers attractive return

As such, Wedbush maintained its $40 per share 12-month price target on the California-based precision medicine oncology biopharma, currently trading at about $26.92 per share.

The return to target from the current share price indicates a compelling return for investors, of 49%.

Ideaya is rated Outperform.

First clinical trial

Next for is GSK101 is evaluation via a Phase 1/2 trial in combination with the PARP (poly-ADP ribose polymerases) inhibitor, niraparib (Zejula), in solid tumors with homologous recombination deficiency, Driscoll reported.

These tumors include BRCA1/2-mutated tumors, of which ovarian cancers comprise about 50% and breast cancers comprise 10−14%.

Wedbush expects that GSK, responsible for the clinical development of GSK101, will launch this initial trial in Q4/23.

When the Phase 1 dose expansion starts, noted Driscoll, Ideaya is due to receive another milestone payment from GSK, this one for $10M.

Synergy with PARP inhibitors

GSK101 is a small molecule inhibitor of polymerase theta, a high-interest target due to its critical role in repairing DNA. The drug specifically targets the ATPase domain of polymerase theta.

Driscoll pointed out that polymerase theta inhibitors in general have been shown to "play nice," or "be synergistic," with PARP inhibitors and "eliminate a subset of PARP inhibitor-resistant tumors." Specifically, in one example, Ideaya demonstrated in preclinical studies that GSK101 strongly synergizes with niraparib in vivo and may overcome or prevent resistance of PARP inhibitors. This bodes well for GSK101 in its first clinical trial.