Olema Oncology could be a leading player in developing therapies for women's cancer, particularly breast cancer, according to Citi Research. Analyst Yigal Nochomovitz rated the clinical-stage biotech company with a buy/high risk rating, saying it has the potential to develop a “next-generation endocrine therapy.” His $20 price target implies the stock could rise more than 72% over the next 12 months. The stock was steady in trading Tuesday, but has fallen more than 16% so far this year. Last year, Olema shares soared more than 470% as the company issued a series of positive updates, particularly on its lead investigational oncology drug, palezastrant, Nochomovitz said. Palazestrant is a complete estrogen receptor antagonist, or CERAN, and a selective ER degrader, or SERD, currently in development for the treatment of ER+/HER2- metastatic breast cancer. The drug, which has been granted “fast track” by the FDA, is an oral compound, meaning it is taken in tablet or pill form. “We believe palazestrant has emerged as a very promising CERAN/SERD with opportunities in multiple ER+ breast cancer lines,” Nochomovitz wrote in a Tuesday note. “While the SERD space remains competitive and Olema lags behind the competition, we view Palazestrant's wild-type ESR1 activity, its favorable combinability with CDK4/6i, and the strategy to combine with ribociclib for the development of 1L. There are possible angles for differentiation to materialize,” he stated. added the analyst. CDK4/6 inhibitors are medications used to treat metastatic breast cancer, or advanced stage IV breast cancer, which has spread to other organs in the body away from the breast. Palazestrant has already shown that it can be safely combined with the CDK 4/6 inhibitors ribociclib and palbociclib in a phase 1/2 study. The company is looking to partner for its Phase 3 studies and Nochomovitz anticipates that the stock could react once such a relationship is announced in the short to medium term.
