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Why Jasper Therapeutics Stock Is Jumping Today

By Cory Renauer – Oct 13, 2021 at 11:17AM

Key Points

  • Oppenheimer initiated coverage on Jasper Therapeutics with a price target more than twice the biotech stock's recent price.
  • Jasper is developing a potential new stem cell conditioning agent that could be a vast improvement over standard methods.
  • Clinical trial results from a small group of leukemia patients produced highly encouraging results earlier this year.

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A Wall Street investment bank just started following the company with a very upbeat outlook.

What happened

Shares of Jasper Therapeutics (JSPR 1.15%) were up 117.8% as of 10:39 a.m. EDT on Wednesday after the company received some affection from Wall Street. Oppenheimer initiated coverage of the small clinical-stage biopharmaceutical company with an outperform rating and a huge price target. 

So what 

Oppenheimer thinks Jasper Therapeutics stock can keep rising above today's enormous gain. The bank initiated coverage with an eye-popping price target of $21 per share, or around 191% above its price at the end of yesterday's trading. 

Excited trader pointing up at a stock chart.

Image source: Getty Images.

Jasper made its stock market debut in September after merging with Amplitude Healthcare Acquisition Corporation. The special purpose acquisition company, or SPAC, fueled the biotech with more than $100 million to develop its lead candidate, JSP191. This is a potential first-in-class antibody designed to deplete stem cells from bone marrow by targeting the stem cell factor receptor called CD117.

Now what

Stem cell transplants are a useful treatment for most blood cancers, but getting new cells to graft is nearly impossible without getting rid of the existing line of stem cells first. Conditioning regimens have become safer over the years, but there's still a great deal of room for improvement. 

It's still early, but so far JSP191 looks like a safe option for lymphoma patients who aren't eligible for traditional myeloablative conditioning. In a phase 1 trial, six out of six patients with myelodysplastic syndrome and acute myeloid leukemia achieved 100% donor cell engraftment after conditioning with JSP191.

There were only six patients in the trial, but the result was especially encouraging because they were all ineligible for standard pre-transplant conditioning. Demand just from patients who can't handle standard pre-transplant conditioning agents could lead to nine-figure annual sales for JSP191. If it's eventually approved for a more general audience, though, the sky's the limit.

Cory Renauer has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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