On Friday, H.C. Wainwright maintained a Buy rating and a $10.00 price target on Lexaria Bioscience (NASDAQ:LEXX), following the announcement of promising interim results from an ongoing animal study related to diabetes treatment.
The study, which began its dosing phase on June 19, 2024, showed that rats treated with Lexaria's DehydraTECH-processed drug formulations experienced either a decreased rate of body weight gain or began to lose weight.
The initial phase of the study involved pre-conditioning Zucker rats, which gained 10.9% body weight on average over 34 days. Still, during the subsequent 28 days of treatment with DehydraTECH-processed drugs, all test articles contributed to weight gain attenuation, with DehydraTECH-CBD formulation 3 (CBD3) and DehydraTECH-liraglutide showing the most significant weight loss results of -1.50% and -1.58%, respectively.
This marks the first instance of DehydraTECH technology being applied to the GLP-1 drug liraglutide, which now has a generic version available in the U.S.
Additionally, the study tested pure semaglutide with DehydraTECH processing, excluding the SNAC technology found in the Rybelsus tablet. The results indicated that the DehydraTECH-processed semaglutide performed nearly identically to the reformulated Rybelsus in terms of body weight gain attenuation. The first cohort of the study, consisting of eight arms, has been completed, and the top-performing arms have moved on to the second cohort.
Cohort 2 of the study includes combinations of DehydraTECH-semaglutide with DehydraTECH-CBD, DehydraTECH-liraglutide with DehydraTECH-CBD, a positive control group using commercially available Rybelsus, and a placebo group. The dosing for this cohort is expected to be completed by mid-October 2024.
The outcomes of this animal study are anticipated to provide valuable insights into which DehydraTECH-processed therapy or combination thereof holds the most promise for weight loss in potential human trials.
In other recent news, Lexaria Bioscience has announced a series of strategic moves to further its growth, including expanding its management team and ramping up its research and development activities.
The company has appointed Nelson Cabatuan as the consulting Chief Strategic Financial Advisor, a move that underscores Lexaria's commitment to strategic financial planning. In addition, the company is in the early stages of planning additional research projects, focusing on glucagon-like peptide-1 (GLP-1) molecules.
H.C. Wainwright has initiated coverage on Lexaria Bioscience, assigning it a Buy rating based on the potential of the company's DehydraTECH technology to significantly impact obesity and diabetes treatment. The company has also made notable advancements in its drug delivery platform studies, including the successful completion of the second dosing phase of its human pilot study, GLP-1-H24-2.
Lexaria Bioscience has initiated a 12-week animal study, WEIGHT-A24-1, to evaluate the effectiveness of its DehydraTECH technology in enhancing the delivery of GLP-1 drugs and CBD for the treatment of diabetes and weight loss.
The company has also added to its intellectual property portfolio with the acquisition of two significant patents pertaining to the treatment of hypertension and epilepsy. These developments are part of Lexaria's ongoing commitment to innovation and growth in the pharmaceutical sector.
InvestingPro Insights
As Lexaria Bioscience (NASDAQ:LEXX) progresses with its promising diabetes treatment study, investors and stakeholders are keenly observing its financial health and market performance.
According to recent data, Lexaria holds a market capitalization of $43.16M and has shown a remarkable revenue growth of 34.05% over the last twelve months as of Q3 2024. Notably, the company's gross profit margin stands at an impressive 98.83% for the same period, highlighting its ability to retain a significant portion of revenue after accounting for the cost of goods sold.
InvestingPro Tips reveal that Lexaria holds more cash than debt on its balance sheet, providing a level of financial stability. Additionally, analysts anticipate sales growth in the current year, which aligns with the positive interim results from their ongoing animal study. However, they do not expect the company to be profitable this year.
For investors looking for more in-depth analysis, there are additional tips available on InvestingPro, which can be accessed at: https://www.investing.com/pro/LEXX. Utilize the coupon code PRONEWS24 to receive up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, offering even more insights to guide investment decisions.
Investors may also find interest in the company's price performance, with a 25.45% return over the last three months and an even more striking 87.76% increase over the last six months. These figures could be indicative of growing investor confidence in Lexaria's market potential, especially in light of the recent advancements in their diabetes treatment research.
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