RBC Capital has maintained its Outperform rating on Fulcrum (LON:FMETF) Therapeutics (NASDAQ: NASDAQ:FULC) and increased its price target from $14.00 to $15.00.
The adjustment comes as the firm looks ahead to the upcoming results from the phase III REACH study of losmapimod in patients with Facioscapulohumeral Muscular Dystrophy (FSHD), expected by the end of October.
RBC Capital, in collaboration with its in-house data science team RBC Elements, performed a sensitivity analysis to assess the potential outcomes of the study. The analysis aimed to identify the minimal change needed between the FSHD patients receiving losmapimod and those on placebo to achieve statistical significance.
This was done using data from the phase II ReDUX4 study, considering various sample sizes and standard deviations.
The firm's assessment suggests that the likelihood of the study meeting the statistical significance bar is higher than previously expected, as a smaller treatment effect may be required.
However, RBC Capital anticipates significant share price volatility, predicting a possible +/-60% movement following the announcement of the study results.
Despite the challenges in predicting outcomes due to the novel endpoint and high-risk nature of the study, RBC Capital sees a potential path to success for losmapimod.
The firm's continued confidence in the therapy's out-year potential in treating FSHD is reflected in the updated price target and the maintained speculative risk rating.
In other recent news, Fulcrum made significant strides in its operations, including a recent exchange of common stock for pre-funded warrants with two institutional stockholders, RA Capital Healthcare Fund, L.P., and an unnamed entity.
The move resulted in RA Capital and the other stockholders trading a total of 9.35 million shares of Fulcrum's common stock for an equivalent number of pre-funded warrants. The warrants, which are immediately exercisable and do not have an expiration date, carry an exercise price of $0.001 per share.
In another key development, Fulcrum has appointed Isabel Kalofonos as Chief Commercial Officer and Heather Faulds as Chief Regulatory Affairs & Quality Assurance Officer. These appointments are anticipated to contribute to the submission of a New Drug Application for losmapimod, a potential treatment for facioscapulohumeral muscular dystrophy (FSHD), and its subsequent commercial launch.
Moreover, Fulcrum is progressing with its Phase 3 REACH trial for losmapimod. The company anticipates reporting top-line data by the end of October 2024, ahead of initial fourth-quarter guidance. In collaboration with Sanofi (EPA:SASY) (NASDAQ:SNY), Fulcrum is preparing for regulatory filings and the commercial launch of losmapimod outside the U.S.
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