H.C. Wainwright has reaffirmed a Buy rating on Spero Therapeutics (NASDAQ: NASDAQ:SPRO) with a price target of $7.00.
The firm's endorsement follows the recent announcement from Spero Therapeutics regarding the successful publication of their Phase 1 trial data.
The trial assessed the intrapulmonary pharmacokinetics (PK) of SPR719, an active compound derived from the oral prodrug SPR720, which is being developed for the treatment of non-tuberculous mycobacterial-pulmonary disease (NTM-PD).
The study, which results were e-published ahead of print in the peer-reviewed journal Antimicrobial Agents and Chemotherapy, demonstrated that SPR719 had significant lung uptake.
Notably, the concentrations of SPR719 in the pulmonary epithelial lining fluid (ELF) and alveolar macrophages (AM) were higher than in the plasma, indicating that the drug effectively targets the lung compartments critical for treating NTM-PD.
The Phase 1 trial was designed to evaluate the safety and intrapulmonary PK of SPR719. The findings showed that peak mean plasma concentrations of SPR719 were reached approximately four hours post-administration and declined over the next 24 hours. Importantly, no meaningful plasma concentrations of the prodrug SPR720 were detected, and no unexpected safety issues arose during the trial.
The improved levels of SPR719 in ELF and AM compared to total plasma concentrations suggest that the drug has the potential for significant lung uptake and efficacy in the targeted tissue compartments. The absence of unexpected safety findings adds to the positive outlook for the drug's development.
In other recent news, Spero Therapeutics reported promising results from a Phase 1 trial for its drug candidate SPR720, aimed at treating Non Tuberculous Mycobacterial-Pulmonary Disease (NTM-PD).
The trial involved 33 healthy adults and suggested potential efficacy in treating NTM-PD with no unexpected safety issues reported. In financial news, the biopharmaceutical company reported a rise in revenue to $10.2 million during its second quarter 2024 earnings call, largely due to collaboration and grant revenues. However, the company also reported a net loss of $17.9 million.
In personnel changes, Spero Therapeutics announced the departure of their Chief Medical Officer and the appointment of Dr. John Pottage as interim clinical lead. On the development front, the company highlighted the progress of their lead assets SPR720, tebipenem-HBr, and SPR206.
The Phase 3 trial for tebipenem-HBr is expected to complete enrollment in the second half of 2025. Despite a wider net loss in Q2 2024 compared to the same period in 2023, and a decrease in revenue from the NIAID agreement and Pfizer (NYSE:PFE) collaboration for SPR206, the company maintains a strong cash position with $63.5 million in cash and cash equivalents.
InvestingPro Insights
To complement the positive outlook on Spero Therapeutics (NASDAQ:SPRO) from H.C. Wainwright's reaffirmed Buy rating, InvestingPro data provides additional context for investors. The company's market capitalization stands at $70.53 million, with a price-to-earnings (P/E) ratio of 3.99, suggesting a potentially undervalued stock relative to its earnings.
InvestingPro Tips highlight that Spero Therapeutics holds more cash than debt on its balance sheet, which could be crucial for funding ongoing research and development efforts, including the promising SPR720 program. Additionally, the company's liquid assets exceed short-term obligations, indicating a solid financial position to support its drug development pipeline.
However, it's important to note that analysts anticipate a sales decline in the current year, and net income is expected to drop. This forecast aligns with the typical financial pattern of biopharmaceutical companies investing heavily in R&D phases.
For investors seeking a more comprehensive analysis, InvestingPro offers 6 additional tips that could provide deeper insights into Spero Therapeutics' financial health and market position.
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