What happened
Shares of Structure Therapeutics (GPCR -3.84%) closed up 18.35% on Monday after the clinical-stage biotech received what is perceived to be good news from Pfizer and a boost from an analyst. The stock went public in February with an initial public offering.
NASDAQ: GPCR
Key Data Points
So what
Structure focuses on oral therapies that treat diseases, especially those of the metabolic, cardiovascular, and pulmonary systems. Its lead product candidate, GSBR-1290, targets type 2 diabetes and obesity. The drug recently entered phase 2 trials to treat type 2 diabetes and obesity and is a small molecule agonist of the GLP-1 receptor (GLP-1-RA).
Structure's stock may have benefited Monday because Pfizer said it was discontinuing clinical trials for lotiglipron, an oral GLP-1-RA candidate, in favor of continuing with another GLP-1-RA therapy, danuglipron. Patients who took lotiglipron showed higher liver enzymes, so safety was a concern.
The move was unpopular with Pfizer's investors and means a little less competition for GSBR-1290. On top of that, Structure just picked up an analyst's rating, and that can influence investors. On Monday, Evan Seigerman of BMO Capital gave Structure a Buy rating with a price target of $40. Last month, Jefferies Financial Group initiated coverage on Structure Therapeutics with a price target between $34 and $41.
Now what
While Structure just went public this year and doesn't have any marketed products yet, GSBR-1290 showed promise in phase 1 trials to treat two relatively large patient populations of diabetics and obese patients.
Before going all-in on Structure, however, it is important to note the company lost $18 million in the first quarter and had, as of the end of the first quarter, $240.9 million in cash. That was enough, it said, to fund operations through the end of 2025. There's a good chance the company will have to raise funds to continue its operations before it starts making any profits from products.
