On Tuesday, H.C. Wainwright adjusted its outlook on Unity Biotechnology Inc (NASDAQ:UBX), lowering the price target to $8 from the previous $10 while maintaining a Buy rating on the stock. The firm's decision comes in anticipation of the Phase 2B ASPIRE trial data for the treatment of diabetic macular edema (DME), expected in the fourth quarter of 2024.
Unity Biotechnology is in the spotlight for its development of a novel senolytic small molecule, Bcl-xL inhibitor foselutoclax (UBX1325), which is believed to offer potential disease-modifying benefits for patients with DME. The company's approach focuses on the elimination of detrimental senescent cells and inflammatory SASP signaling in the retina, a method that could revolutionize the treatment of DME.
Recent publications, including preclinical and Phase 1 results, have highlighted the significant role of retinal senescent cells in DME pathology. Unity Biotechnology's UBX1325 is designed to therapeutically eliminate these cells, potentially reducing diabetes-induced retinal vascular leakage and preserving retinal function. This therapeutic strategy is supported by findings published in Nature Medicine in 2024.
The revised price target reflects adjustments in the projected launch revenue timeline for foselutoclax, now expected in 2026 rather than 2025. Additionally, H.C. Wainwright has temporarily removed modeled revenue from potential clinical developments in diabetic retinopathy (DR) and age-related macular degeneration (AMD (NASDAQ:AMD)) from its valuation. However, the firm identifies the lead optimization development of UBB2048 in retinal vascular diseases as a potential upside.
Despite the reduction in the price target, H.C. Wainwright reiterates its confidence in Unity Biotechnology's stock with a Buy rating. The firm emphasizes the significance of the upcoming Phase 2B ASPIRE trial data, which could align with the successful findings from earlier phases of the trial.
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