Approval Of Baricitinib For Patchy Baldness Validates Clinical Patch For This Small-Cap Stock

Olumiant (baricitinib), a Janus kinase (JAK) inhibitor, was developed by Incyte Corp INCY and launched in collaboration with Eli Lilly And Co LLY, received FDA approval for hair loss disorder known as alopecia areata (AA).
Olumiant was first approved for the treatment of rheumatoid arthritis (RA) in 2018.
The above nod is expected to provide a template for Equillium Inc EQ EQ-101 in this indication, says HC Wainwright.
Related: Lilly-Incyte Snag FDA Nod For Patchy Hair Loss Treatment — Smaller Rival's Stock Shoots Up In Sympathy.
The analysts write that the size and design of the pivotal trials with baricitinib in AA are manageable and should prove relatively cost-effective if EQ-101 is advanced into Phase 3 studies.
EQ-101's niche to exploit impact on AA may be eclipsed even after clinically meaningful and competitive data, as JAK inhibitors have come under scrutiny for safety reasons.
The analysts reiterate a Buy rating and a price target of $15 per share on EQ.
"From our vantage point, investors continue to ignore the potential of the Bioniz portfolio that Equillium acquired earlier this year, including EQ-101," writes HC Wainwright.
Related: Equillium Adds Three Drugs To Its Pipeline Via Bioniz Acquisition.
Price Action: EQ shares are up 2.97% at $2.08 during the market session on the last check Tuesday.

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