MA Biotech Downgraded to Neutral After Second FDA CRL for RP1 Melanoma BLA
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Disclosures for WedBush Securities, Replimune Group, April 13, 2026

Valuation Our PT is based on 7x est. US sales and 15x est. EU royalties of RP1 in PD-1 refractory melanoma in 2029, discounted by 20%. Company Description Replimune is a clinical-stage biopharmaceutical company based in Woburn, MA, developing intratumorally-delivered oncolytic virus (OV) therapies. Risks to the Attainment of Our Price Target and Rating: Risks to the attainment of our price target and rating for REPL include clinical and regulatory failure of RP1 and an inability to achieve sales estimates. RP1 may not prove to be efficacious, or safety signals could halt development. RP1 could also face commercial challenges from current and future therapies Analyst Certification We, Robert Driscoll and Geoffrey Von Der Ahe, 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. Mentioned Companies Investment Rating System: OUTPERFORM: Expect the total return of the stock to outperform relative to the median total return of the analyst's (or the analyst's team) coverage universe over the next 6-12 months. NEUTRAL: Expect the total return of the stock to perform in-line with the median total return of the analyst's (or the analyst's team) coverage universe over the next 6-12 months. 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On April 13, 2026, analysts Robert Driscoll, Ph.D., and Geoffrey Von Der Ahe of Wedbush Securities downgraded Replimune Group Inc. (REPL:NASDAQ) to NEUTRAL from OUTPERFORM and lowered their 12-month price target to US$2.00 from US$19.00, implying downside from the April 13, 2026, closing price of US$4.76, following the FDA's issuance of a second complete response letter (CRL) for the company's Biologics License Application (BLA) for RP1 (vusolimogene oderparepvec) in combination with nivolumab in PD-1 refractory melanoma.

The FDA had previously issued a CRL in July 2025, citing a heterogeneous patient population and an inadequately controlled study, which did not allow substantial evidence of efficacy to be established from the single-arm Phase 2 IGNYTE trial that enrolled 140 patients. After a Type A meeting, Replimune submitted a complete response, leading to an April 10 PDUFA date. In the updated CRL, the FDA cited three deficiencies tied to the IGNYTE study: an inability to isolate RP1's contribution when administered with nivolumab, heterogeneity of the study population, and uncertainty around response assessments, including surgical interventions with the potential to confound results.

According to the analysts, the FDA also concluded that exploratory analyses from IGNYTE and an early look at data from the ongoing confirmatory Phase 3 trial (representing roughly 10% of the patient population) did not alleviate previously communicated concerns about inconsistencies between IGNYTE response criteria and RECIST v1.1. The agency pointed to evaluation shortcomings in the Phase 3 trial, including responses measured only by the investigator, a lack of durability data, and insufficient controls. Specific confounders cited included fewer than 50% noninjected target lesions, inclusion of re-injected patients following progression, surgical interventions and removal of target lesions, and potential bias from histological response. The FDA further referenced concerns raised in Type B meetings in March 2021 and September 2024 regarding the single-arm study design and approval potential. Topline data from the randomized CERPASS Phase 2 study in advanced cutaneous squamous cell carcinoma (CSCC), evaluating RP1 plus cemiplimab versus cemiplimab alone, were announced in December 2023 and did not meet its primary endpoint. The FDA invited Replimune to discuss a revised protocol and statistical analysis plan or propose a new clinical study, which the analysts view as signaling significant risk for continuing the Phase 3 in its current form.

Replimune's response, the analysts noted, highlighted inconsistencies with the FDA's regulatory process and communications. The company indicated that during a Type A meeting in September 2025, the FDA acknowledged that randomizing patients to an anti-PD-1-only arm in the confirmatory study was not feasible and had not raised heterogeneity concerns following melanoma expert testimony. Phase 3 data requested by the agency showed progression-free survival (PFS) of 30.6 months for RP1 plus nivolumab compared to 4.4 months on prior PD-1-based regimens, indicating a significant treatment effect. Replimune also stated that detailed analyses showed no material difference in response rates between injected and non-injected lesions, and that biopsies and surgical interventions did not impact tumor response. The company highlighted that a different review team was appointed for the resubmission, replacing a prior team, with a senior member of the prior team publicly stating on a subsequently deleted LinkedIn post that the "BLA clinical team thought the applicant had provided adequate evidence to support contribution of effect of RP1 plus nivolumab, but leadership did not agree."

The analysts characterized the additional CRL as disappointing given what they viewed as a convincing treatment effect in a patient population with significant unmet need. They referenced the FDA's own analysis showing that patients treated with single-agent anti-PD-1 after confirmed progressive disease on anti-PD-1 demonstrated a 6%–7% response rate (Beaver et al., 2018; Ribas et al., 2018). They also pointed to Iovance Biotherapeutics Inc.'s (IOVA:NASDAQ) TIL therapy Amtagvi, which was approved in February 2024 based on single-arm study data showing an objective response rate of 31.5% with a treatment-related mortality of 7.5%, as well as the prior approval of monotherapy T-vec as evidence of single-arm activity for an oncolytic virus with a similar backbone.

On valuation, the price target is based on 7x estimated US sales and 15x estimated EU royalties of RP1 in PD-1 refractory melanoma in 2029, discounted by 20%. Replimune is a clinical-stage biopharmaceutical company based in Woburn, Massachusetts, developing intratumorally delivered oncolytic virus therapies. As of April 13, 2026, the company had a market capitalization of US$393 million, 92.2 million shares outstanding, and a 52-week trading range of US$2.68 to US$13.24. The analysts model GAAP EPS of (US$3.54) for FY2025E, (US$2.42) for FY2026E, and (US$2.37) for FY2027E, with the revised price target reflecting expected cash in Q2 2027 and acknowledging that a likely restructuring ahead may alter estimates. Risks to the rating and price target include clinical and regulatory failure of RP1, inability to achieve sales estimates, potential safety signals halting development, and commercial challenges from current and future therapies. The analysts said they see no path forward for RP1 with IGNYTE and significant risk for the ongoing Phase 3 study, and they look forward to potential clarity around readthrough of the identified deficiencies to ongoing studies of RP2, including the randomized Phase 2/3 REVEAL trial in uveal melanoma.