H.C. Wainwright Assumes Capricor Therapeutics (CAPR) at Buy

H.C. Wainwright assumed coverage on Capricor Therapeutics (NASDAQ: CAPR) with a Buy rating and a price target of $13. Analyst Swayampakula Ramakanth sees potential CDC platform validation.

"Capricor has developed three regenerative medicine platforms: 1) cardiosphere derived cells (CDC) for the treatment of heart failure (HF) and cardiac regeneration; 2) natriuretic peptides for heart failure; and 3) exosomes for yet-to-be disclosed indications. While management plans to develop the CDC and exosome platforms independently, the natriuretic peptide platform is expected to be partnered. If the Janssen division of Johnson & Johnson (JNJ; not rated) licenses CAP-1002 (expected in 2Q17), we believe it would be a significant validation of the CDC platform," said the analyst.

"The CDC platform has yielded two drugs, CAP-1001 and CAP-1002. CAP-1001 was tested in a proof-of-concept CADUCEUS trial (n=25) that showed lowering of the amount of scar tissue and increased healthy tissue after a single administration of the cell-based drug to post-myocardial infarction (MI) patients. Encouraged by the results, Capricor has launched two Phase 1/2 studies, ALLSTAR (n=134) and DYNAMIC (n=14) with CAP-1002. Interim data from both studies have been positive. Currently, Janssen is funding the manufacturing of the cells and has the first right of refusal for exercising its option to license worldwide rights to CAP-1002 for cardiovascular indications. The decision is expected within 60 days of the release of six-month data from ALLSTAR (1Q17). With the recent publication of positive 12-month data from the DYNAMIC study that showed maintenance of cardiac improvements seen at six months, we believe Janssen could exercise its option, and according to the agreement, Capricor could receive license and milestone payments of up to $325M in addition to double-digit royalties. If CAP-1002 is approved, we project risk-adjusted sales and royalty revenues to grow from $17M in 2019 to $250M in 2026," Ramakanth added.

For an analyst ratings summary and ratings history on Capricor Therapeutics click here. For more ratings news on Capricor Therapeutics click here.

Shares of Capricor Therapeutics closed at $4.26 yesterday.

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