What happened

Shares of Mirati Therapeutics (NASDAQ:MRTX) were jumping 12.6% as of 11:17 a.m. EDT on Monday. The nice gain came after the company announced positive preliminary data on Sunday from phase 1/2 clinical studies of experimental drug adagrasib in treating advanced non-small cell lung cancer (NSCLC). These results prompted two analysts to boost their price targets for Mirati.

So what

Mirati reported that 45% of patients in its phase 1/1b and phase 2 cohorts evaluating adagrasib as a monotherapy in treating NSCLC experienced confirmed objective response rates (ORR) -- the percentage of patients with tumor size reduction meeting a specified target level. In addition, the company stated that there was a 96% disease control rate (DCR), which measures the percentage of patients whose cancer shrinks or remains stable over a set period of time.

Doctor looking at a scan of lungs

Image source: Getty Images.

How good were these results? Piper Sandler analyst Tyler Van Buren said he thinks adagrasib could have a "potential best-in-class efficacy advantage." Van Buren bumped his one-year price target for Mirati to $210 from $170.

SVB Leerink analyst Andrew Berens was also impressed. He thinks adagrasib could have a leg up on Amgen's AMG-510. Berens also said he thinks Mirati could be on track to secure accelerated approval for its candidate. He raised his price target on the biotech stock to $195 from $134.

Now what

The phase 2 study of adagrasib as a monotherapy in treating second- and third-line NSCLC is still ongoing. However, Mirati expects to file for FDA accelerated approval in the second half of 2021. The company is also initiating pivotal studies of adagrasib as both a monotherapy and in combination with other drugs as a first-line treatment for NSCLC and colorectal cancer.

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