This Analyst Says Arbutus' EASL Presentations Outline Path For A Functional Cure For Chronic Hepatitis B

JMP Securities reiterates its Market Outperform rating but reduces the price target to $9 from $10 on Arbutus Biopharma Corp ABUS after data presentation at the European Association for the Study of the Liver International Liver Congress.
The analysts said that AB-729 produces consistent s-antigen reductions across e-antigen positive and negative chronic hepatitis B patients, and e-antigen reductions were also observed for all patients.
JMP views that the results should support the potential use of AB-729 as a component of the functional cure across a broad range of patients.
Arbutus also presented initial results from CHB patients dosed QD with 50 (n=9), 100 (n=11), 200 (n=10) mg of capsid inhibitor AB-836, or placebo (n=5).
Patients experienced robust reductions in HBV DNA, up to 4 log10, but there were also several ALT and AST elevations (elevated liver enzymes).
Arbutus will conduct a study in healthy volunteers, likely with a longer duration, to determine if the liver enzyme elevations are beneficial or toxic.
JMP suspects an "on target" effect causing the toxicity. However, Enanta Pharmaceuticals Inc ENTA reports similar DNA reductions for capsid inhibitor EDP-514 with no clinically significant ALT/AST elevations in 19 patients across three doses.
The analysts have lowered AB-836 probability of approval from 60% to 50%, resulting in a new price target of $9.
Price Action: ABUS shares are down 1.49% at $2.64 during the market session on the last check Tuesday.

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