Tuesday, H.C. Wainwright adjusted its outlook on Aethlon Medical (NASDAQ:AEMD), reducing the price target to $7 from $10, while sustaining a Buy rating on the stock. The revision follows Aethlon Medical's announcement on June 18 regarding the approval to conduct a clinical trial for its Hemopurifier device.
The trial, which received a green light from the Human Research Ethics Committee of the Central Adelaide Local Health Network (LON:NETW), aims to evaluate the safety, feasibility, and dosage of the Hemopurifier in treating cancer patients. This device is designed to extract viruses, bacterial toxins, and cancer-promoting extracellular vesicles from the blood, which are factors known to contribute to cancer spread and resistance to anti-PD-1 therapies such as Keytruda and Opdivo.
Aethlon's Hemopurifier has previously demonstrated the ability to reduce cancer patient blood exosomes in laboratory settings, bolstering the firm's positive stance on the upcoming study. The significance of this trial is underscored by the fact that only about 30% of patients treated with Keytruda or Opdivo experience long-term clinical responses, highlighting the medical community's potential interest in alternative treatments.
The company is awaiting further approvals from ethics committees at additional sites in Australia and one in India to expand its Hemopurifier studies. The initiation of patient enrollment, expected in the second half of 2024, along with other advancements, are anticipated to serve as positive developments for Aethlon Medical.
Despite the lower price target, H.C. Wainwright reaffirmed its Buy rating, attributing the adjustment to share dilution from recent financing activities. The firm remains impressed with Aethlon's rapid advancements in applying the Hemopurifier within oncology.
In other recent news, Aethlon Medical, Inc. has made significant strides in its operations. The company's Hemopurifier device has received full ethics approval for a clinical trial in cancer patients. This approval, granted by the Human Research Ethics Committee of the Central Adelaide Local Health Network, allows the company to test the safety, feasibility, and optimal dosage of the Hemopurifier in patients with solid tumors who have not responded to anti-PD-1 antibodies.
In addition to the trial approval, Aethlon has announced the pricing of its public offering at $4.7 million. This offering consists of 8.1 million shares of common stock and two classes of purchase warrants, with Maxim (NASDAQ:MXIM) Group LLC acting as the exclusive placement agent. The net proceeds are planned to be used for general corporate purposes.
Furthermore, the Hemopurifier device, which is designed to remove extracellular vesicles from the bloodstream, has shown promise in a pre-clinical study. The study evaluated the device's ability to remove these vesicles from the plasma of cancer patients treated with anti-PD-1 antibodies.
InvestingPro Insights
As Aethlon Medical (NASDAQ:AEMD) prepares to embark on clinical trials for its Hemopurifier device, the company's financial health and market performance offer additional context to investors following H.C. Wainwright's revised outlook. InvestingPro data shows a market capitalization of $5.79 million USD, underscoring the small-cap nature of the firm. Despite a staggering revenue growth of 4278.2% in the last twelve months as of Q3 2024, Aethlon faces a significant operating income margin of -2047.16%, indicating substantial expenses relative to its revenue.
InvestingPro Tips reveal a mixed picture: on one hand, Aethlon holds more cash than debt on its balance sheet and has liquid assets exceeding its short-term obligations, suggesting a degree of financial resilience. On the other hand, analysts express concern, noting the company's quick cash burn and lack of profitability in the last twelve months. Moreover, the stock has experienced high volatility, with a notable return of 49.33% over the last month, yet a sharp 63.95% decline over the last three months.
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