On Tuesday, Oppenheimer maintained an Outperform rating on Corvus Pharmaceuticals (NASDAQ:CRVS) but lowered the stock's price target to $7.00 from the previous $8.00. This adjustment follows the company's announcement of its fourth-quarter and full-year results, which included a refined strategy for its lead drug candidate, soquelitinib.
The biopharmaceutical company has decided to concentrate its efforts on a pivotal study for soquelitinib in relapsed or refractory peripheral T-cell lymphoma (rPTCL) and to establish human proof of concept for the treatment of atopic dermatitis. Plans to develop soquelitinib for renal cell carcinoma (RCC) have been put on hold for the time being.
Corvus Pharmaceuticals is also ramping up its business development activities, having recently appointed a Chief Business Officer (CBO) to spearhead these initiatives. Despite these developments, the company faces financial constraints, ending the year with $27.1 million in cash reserves.
The analyst from Oppenheimer noted that without formal guidance on financial runway from the company's management, it is expected that Corvus will face challenges in sustaining its cash reserves through the fourth quarter of 2024.
This situation may necessitate a financing event or a significant partnership deal to maintain operations. The price target has been updated to reflect these considerations, along with the actual financial results and the potential for a financing event in the third quarter of 2024.
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