H.C. Wainwright Reiterates $28 Target On Bellus Despite Phase 2 Miss

H.C. Wainwright analyst Andrew Fein reiterates a Buy rating on Bellus Health (BLU) with a $28 price target after the Phase 2 RELIEF study of BLU-5937 in chronic cough did not achieve the primary endpoint of reductions in awake cough frequency.

The stock in premarket trading is down 75%, or $8.97, to $3.05. Despite the miss, a closer look at the data presented from high cough count patients coupled to a "well-tolerated" safety profile does not change the positive narrative for BLU-5937, Fein tells investors in a research note.

The analyst says that while the data from both populations of RELIEF were "underwhelming," he's encouraged by the correlation between awake cough frequency at baseline versus reduction in awake cough frequency which was statistically significant. A closer look at how many patients cough is really driven by hypersensitization of P2X3 could be a differentiator and key criteria for future enrollment, adds Fein.

He thinks that if BLU-5937 is able to show a meaningful reduction in cough frequency for high cough count patients while maintaining its "best-in-class" safety profile, Bellus is a "prime candidate for acquisition." Fein feels future label expansion of BLU-5937 "remains achievable beyond the current pipeline."

Disclosure: None.

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