RBC Capital sees upside to $117

Shares of CRISPR Therapeutics AG (NASDAQ: CRSP) fell just under 10% on Wednesday as the biotech firm presented updated data for the phase 1 trial of its blood cancer candidate CTX 110. 

RBC Capital maintained a ‘sector perform’ rating

In a new research report on Wednesday, RBC Capital Markets maintained a “sector perform” rating on CRISPR’s stock with an unchanged $117 price target. 

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Analyst Luca Issi cited “solid responses in DLBCL at DL2+” but underwhelming durability compared to ALLO as he confirmed the rating. 

CRSP reported an overall response rate of 58% and a complete response rate of 38% that closely matched ALLO’s 64% and 46%, respectively. At six months, however, its CR of 21% was “underwhelming and directionally inferior” to ALLO’s 36%. Issi wrote:

We note the delta would be even larger (CR=18% vs CR=40%) if CRSP’s lowest dose (DL1) is included and the denominators computed similarly (ALLO did not exclude CR/PR/SDs yet to reach six months).

CRSP used ITT as the benchmark versus ALLO that uses a higher bar, mITT. 

CRSP presented a better safety profile

On the other side, CRSP presented a better safety profile with only one death potentially related to the treatment versus ALLO’s five. With a lower infection rate but a higher CRS, however, the analyst said he wasn’t convinced that avoiding “anti-CD52 will materially expand safety margins”.

CRSP started the trial over two years ago and said it will report full data in 2020. To Issi’s surprise, however, the biotech firm is a year late in presenting the data at a medical meeting. The analyst also added: 

CRSP is planning to pursue the highest dose (600M cells) and expand the trial into potentially registrational. On dosing frequency, CRSP will follow ALLO’s lead by implementing consolidation.