2 Regeneron Analysts On COVID-19 Antibody Cocktail's Emergency Use Authorization Prospects

Regeneron Pharmaceuticals Inc REGN announced positive preliminary Phase 1/2/3 results Tuesday for a study that evaluated its antibody cocktail REGN-COV2 in non-hospitalized coronavirus patients. 

REGN-COV2 is composed of two anti-spike monoclonal antibodies that target the receptor binding domain of the coronavirus and prevent it from docking with host cells.

The Regeneron Analysts: Piper Sandler analyst Christopher Raymond maintained an Overweight rating on Regeneron shares with a $675 price target. 

Morgan Stanley analyst Matthew Harrison maintained an Equal-weight rating and $611 price target.

EUA Likely, Piper Sandler Says: Although it's too early to provide hard endpoints like survival and days of hospitalization, REGN-COV2 conferred a rapid and statistically reduction in viral load in moderate coronavirus patients, with near-clearance by day  seven regardless of baseline viral load, Raymond said in a note. 

In the more vulnerable seronegative patients, the median time to alleviation of symptoms was seven days for the lower dose of the antibody cocktail and six days for the higher dose versus 13 days for the control arm, the analyst said.

The trial also showed a trend favoring reduced medical visits, he said. 

The cocktail's clear reduction of viral load and time to symptom alleviation — mainly in seronegative patients — along with its pristine safety profile, if replicated, will be more than enough evidence for the FDA to provide an emergency use authorization, in Piper Sandler's view. 

Data In More Severe Patients Needed, Morgan Stanley Says: The data highlighted the potential role of the humoral immune response, or more specifically neutralizing antibodies, in reducing the viral load and alleviating symptoms more rapidly, Harrison said in a note. 

The data also partially de-risks the SARS-CoV-2 vaccines designed to induce nAbs against the spike protein, including the leading vaccine candidates, the analyst said. 

"Overall, we believe these data highlight the variable immune responses associated with SARS-CoV-2 and the potential role REGN-COV2 could play in compensating for a weak immune response," he said. 

Yet regulators will ask for more data in sicker patients before potentially granting emergency use authorization, according to Morgan Stanley. 

REGN Price Action: At last check Wednesday, Regeneron shares were slipping 2.28% to $560.54.

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