Wilsons keeps ‘overweight’ rating on Neuren as shares fall
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The news: Wilsons Advisory analysts have retained their ‘overweight’ rating on Neuren Pharmaceuticals despite little progress on a phase three drug trial design for Phelan-McDermid syndrome.
The numbers: Wilsons analysts also retained a 12-month price target of $29.56 on the stock.
Neuren shares were down 4% to $13.63 in early trading on the ASX.
The context: The company on Monday provided an update on its meeting with the US Food and Drug Administration on the phase three drug trial design for Phelan-McDermid syndrome.
The analysts said Neuren had positive interactions with the US FDA as it confirmed that a phase three registrational program with NNZ-2591 is likely next year, and this supported their conviction on the asset. They also noted that further updates and confirmation of trial size, cost, and timelines would be crucial catalysts for the stock.
What they said: "The update was perhaps more incremental than hoping, noting that confirmation of the primary endpoint/s for the study, as well as costs and projected timelines we are yet to find out," the analysts said in a note.
"Importantly, evaluations of the size of the trial we cannot determine without understanding the primary endpoint and its relevant effect size from the phase two study data. Sample size will also guide timeline and cost estimates.
"This data we expect to be a catalyst for NEU, given this was a positive, but more piecemeal, update with regards to what the next 12 to 18 months looks like for the NNZ-2591 program."
The source: Wilsons Advisory research
