On Monday, Stifel reiterated its Buy rating on shares of Compugen (NASDAQ:CGEN) with a steady price target of $4.00. The firm's analysis follows Compugen's strategic shift to deprioritize the clinical development of a specific drug regimen for MSS mCRC patients, a change that was not seen as surprising by industry observers.
The decision was influenced by the historical difficulty in treating this patient group with immunotherapy, ambiguous results from previous trials, and the improbability that additional patient data would clarify the best path forward.
Compugen's announcement precedes the upcoming data presentation at the American Society of Clinical Oncology (ASCO) conference, removing what could have been a significant near-term event for the company's stock.
The focus now shifts to the end-of-year data from a separate trial in PROC, which is anticipated to validate the unique value of COM701 and bolster confidence in the company's pipeline, independent of its collaborations with Gilead Sciences (NASDAQ:GILD) and AstraZeneca (NASDAQ:AZN).
The updated financial model for Compugen now reflects reduced operating expense forecasts for the fiscal year 2024 and beyond. This adjustment is a direct result of the company's strategic decision to allocate resources away from the less promising MSS mCRC treatment approach.
Despite the change in clinical strategy, Stifel's stance on Compugen remains positive, with the firm maintaining its Buy rating on the stock.
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