Just two weeks ago, Upstream Bio, Inc. (NASDAQ:UPB) closed its upsized initial public offering (IPO) of 17.25 million shares at $17 per share, with gross proceeds of approximately $293 million.
Upstream Bio is a clinical-stage biotechnology company developing treatments for inflammatory diseases with an initial focus on severe respiratory disorders.
- Piper Sandler initiated coverage on Upstream Bio with an Overweight rating and a price target of $75.
- William Blair has also initiated coverage of Upstream Bio with an Outperform rating
Piper Sandler noted the company's lead program, verekitug, has a differentiated mechanism of action that targets the TSLP receptor vs. ligand.
The TSLP ligand has been de-risked by AstraZeneca Plc (NASDAQ:AZN) / Amgen Inc (NASDAQ:AMGN) Tezspire's 2021 approval in severe asthma, the analyst says. It represents a rapidly growing biologic market opportunity of over $7.5 billion.
Piper analyst writes, "verekitug's key advantage is its durability given its high potency, enabling Q12W dosing and potentially up to Q24W dosing, which is significantly lower compared to other biologics such as Tezspire (Q4W dosing) and Regeneron Pharmaceuticals Inc (NASDAQ:REGN) / Sanofi SA's (NASDAQ:SNY) Dupixent (Q2W dosing).
William Blair also based its rating on the blockbuster potential of verekitug in large indications, including asthma and chronic obstructive pulmonary disease (COPD).
"The analyst writes that "Verekitug has the potential to deliver differentiated efficacy and longer dosing intervals than currently approved biologics for the treatment of asthma, most notably the TSLP antibody Tezspire, which targets the ligand.
William Blair writes that demonstrating clinical efficacy at least comparable to Tezspire, with dosing intervals of every three to six months, could position the therapy as a blockbuster, aligning with patient preferences for fewer doses.
However, early preclinical and clinical data for verekitug indicate a potential for even greater efficacy than Tezspire, which could exceed current baseline expectations.
Price Action: Upstream Bio stock is up 12.5% at $28.30 at last check Tuesday.
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