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February 21, 2024 : In a move that signals optimism for the future of CG Oncology, Morgan Stanley initiated coverage of the company’s shares with an “Overweight” rating. This positive assessment, issued on Tuesday, comes on the heels of encouraging data from CG Oncology’s clinical trials, particularly for its lead candidate, cretostimogene grenadenorepvec.
The analyst firm highlights CG Oncology’s focus on developing therapies for bladder cancer, a condition that afflicts millions worldwide. Their primary interest lies in cretostimogene grenadenorepvec, currently undergoing Phase 3 trials as a monotherapy and Phase 2 trials in combination with pembrolizumab. This drug targets high-risk, non-muscle invasive bladder cancer patients who haven’t responded to standard treatments.
Morgan Stanley expresses confidence in cretostimogene grenadenorepvec’s potential to become the new standard of care, potentially replacing the current BCG therapy. They find the data supporting this claim compelling, citing the drug’s efficacy exceeding that of other approved and developmental treatments, with a significant proportion of patients achieving undetectable cancer. Notably, the combination therapy with pembrolizumab showcased even higher efficacy rates.
Furthermore, the analysts commend CG Oncology’s focus on expanding its reach within the bladder cancer treatment market, estimating a potential patient pool exceeding 55,000 individuals. Additionally, they anticipate multiple data readouts and milestones throughout 2024, potentially further solidifying the company’s positive trajectory.
While acknowledging the competitive nature of the bladder cancer market, Morgan Stanley believes the strong data supporting cretostimogene grenadenorepvec offers a compelling advantage. They assign a price target of $55.00 per share, reflecting their optimistic outlook for the company’s future.
