Leerink Partners has maintained its Outperform rating and $19.00 price target for Tango Therapeutics Inc. (NASDAQ: TNGX).
The firm's stance comes ahead of the biotech company's year-end clinical update for its PRMT5 inhibitors, TNG908 and TNG462.
According to Leerink, this update is poised to be significant for the company's stock performance.
Tango Therapeutics has indicated that it will provide data on approximately 30-35 patients for TNG462, including about 20 at the expansion doses. For TNG908, the company is expected to present data on roughly 60-65 patients, with at least 10 treated at the 600mg BID dose and 15-20 glioblastoma (GBM) patients. Leerink outlines the landscape of preclinical and clinical data for PRMT5 inhibitors and provides insights on the efficacy benchmarks for Tango Therapeutics.
The firm compares the expected outcomes to recent data from Amgen (NASDAQ:AMGN)'s AMG193, which showed an objective response rate (ORR) of 15% in biliary tract cancer (BTC) at ESMO 2024. This comparison is relevant as Tango Therapeutics has a sufficient sample size in BTC for relative analysis.
Leerink suggests that the efficacy of TNG462 could be differentiated as best-in-class, despite potential surprises for investors related to the efficacy data in other tumor types and the upcoming update from Bristol Myers (NYSE:BMY) Squibb on October 23-25 for BMS-986504, which could shift the competitive landscape.
Leerink notes that Tango Therapeutics' stock is trading near 52-week lows, influenced by Amgen's disappointing update at ESMO. Nonetheless, the firm believes that the upcoming dataset could set TNG462 apart from Amgen's compound, citing the drug's promising preclinical attributes. Leerink concludes by reiterating a positive outlook on TNG462's potential within the significant market opportunity of MTAP-deleted cancers, which are estimated to comprise 10-15% of all cancers.
In other recent news, Tango Therapeutics has seen significant developments in its drug pipeline. Tango Therapeutics recently halted the development of its key drug candidate, TNG348, due to observed liver function abnormalities in trial participants.
Despite this, the company's cash runway is now projected to last into 2027, allowing the company to explore other therapeutic opportunities, particularly the PRMT5 program. Analysts from Piper Sandler, H.C. Wainwright, and Jefferies have maintained positive ratings on the company's shares.
Piper Sandler expressed continued optimism for Tango Therapeutics' own PRMT5 inhibitors, TNG462 and TNG908, with initial data from the trials expected by the end of 2024. H.C. Wainwright maintained a Buy rating with a steady price target of $13.00, while Jefferies issued a Buy rating with a price target of $19.00.
InvestingPro Insights
Recent InvestingPro data provides additional context to Leerink Partners' analysis of Tango Therapeutics (NASDAQ: TNGX). Despite the firm's optimistic Outperform rating and $19.00 price target, TNGX faces some financial challenges. The company's market capitalization stands at $732.87 million, with a negative P/E ratio of -6.25 for the last twelve months as of Q2 2024, reflecting its current unprofitability.
InvestingPro Tips highlight that TNGX is quickly burning through cash and is not expected to be profitable this year. This aligns with the company's focus on clinical development, which often requires significant investment before potential commercialization. The stock's recent performance has been weak, with a -34.86% return over the past month, possibly influenced by the disappointing update from Amgen at ESMO that Leerink mentioned.
However, it's worth noting that TNGX holds more cash than debt on its balance sheet, which could provide some financial flexibility as it advances its clinical programs. Additionally, the company's revenue growth of 26.16% over the last twelve months suggests ongoing business development despite the challenges.
For investors considering TNGX, InvestingPro offers 10 additional tips that could provide further insights into the company's financial health and market position. These additional tips could be particularly valuable given the upcoming clinical update that Leerink Partners believes will be significant for the stock's performance.
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