Blood Cancer Player Arcellx Finds Place On Analyst Conviction List - Potential Room For Growth In 2024

Needham analyst forecasts a positive outlook for Arcellx Inc ACLX in 2024, citing strong potential stemming from the anticipated pivotal interim readout from the iMMagine-1 study, expected in the second half of 2024. 

This development is poised to bolster filing prospects for the company in 2025. CART-ddBCMA (anitocabtagene autoleucel or anito-cel), the flagship product of Arcellx, displays promising potential for value creation, particularly upon disclosing its clinical design for deployment in earlier line settings.

Needham analyst reiterates a Buy rating on ACLX, raises the price target to $71 from $65, and adds ACLX to the Needham Conviction List, replacing Sarepta Therapeutics Inc SRPT.

According to the analyst, Anito-cel showcases comparable or potentially superior efficacy to the market leader, Johnson & Johnson JNJ/Legend Biotech LEGN Carvykti, while demonstrating a notably improved safety profile. 

Notably, in the Phase I study conducted in 2023, Anito-cel displayed an upfront Overall Response Rate and durability on par with Carvykti, even outperforming it in treating patients with extramedullary disease. 

The overall sentiment from the analysis anticipates a favorable trajectory for Arcellx in 2024, emphasizing the company’s relatively de-risked asset status.

In 2023, Arcellx stock appreciated around 75% versus the S&P 500, up around 24%.
Needham notes ACLX has room to grow, assuming anito-cel can capture a significant portion of the ~$20 billion market opportunity across multiple myeloma.

Price Action: ACLX shares are up 2.70% at $55.92 on the last check Thursday.