Flexing On Muscular Dystrophy, Analyst Expects Almost 200% Upside For Edgewise Therapeutics

Truist initiated coverage on Edgewise Therapeutics Inc EWTX with a Buy rating and a price target of $25.

The analyst notes encouraging data from lead drug EDG-5506 in Becker Muscular Dystrophy (BMD), suggesting a benefit to muscle injury sustained over six months.

The company is advancing the CANYON trial evaluating EDG-5506 in individuals with BMD. CANYON will assess the effect of EDG-5506 over 12 months on safety, pharmacokinetics (PK), biomarkers, and functional measures

Edgewise Therapeutics expects to amend the CANYON study to include a potentially registration-enabling cohort in 2H of 2023.

The company is evaluating EDG-5506 in Duchenne muscular dystrophy (DMD). LYNX Phase 2 trial is ongoing, with interim data expected in Q4 of 2023.

The analyst writes that EDG-5506 has the potential to become standard-of-care in BMD and enhance efficacy as a combo partner with different modalities in DMD. 

While preclinical & early clinical data have been encouraging, long-term data from Ph1b & Ph2 data are likely needed to boost investor confidence, writes the analyst.

With data readouts expected over the next 12-18 months, Truist sees a favorable risk-reward profile for the stock, with a potential upside of 50%-200%.

Price Action: EWTX shares are up 11.20% at $9.75 on the last check Monday.