What happened
Shares of Gracell Biotechnologies (GRCL) were up 21.5% Tuesday afternoon. The healthcare stock rose for the second consecutive day, boosted by an analyst's upgrade, as well as by positive trial news. The stock is up more than 156% so far this year.
So what
Gracell is a clinical-stage biotech company that makes cell therapies to treat cancers and autoimmune diseases. Over the weekend, the company announced positive long-term follow-up trial data regarding its lead therapy, GC012F, to treat patients with relapsed/refractory B-cell non-Hodgkin's lymphoma. The CAR-T therapy is a CD19 and B-cell maturation antigen.
In the study, all nine patients showed an overall response rate nine months after the therapy, with 77.8% having a complete response (CR) rate at three months and 66.7% having a CR at six months. The study comes on the heels of an announcement on June 3 that said GC012F did well in long-term follow-ups as a therapy to treat relapsed/refractory multiple myeloma.
In likely responses to the trial data, BTIG analyst Justin Zelin reiterated his buy rating on the stock with a price target of $20, and analyst Joseph Catanzaro from Piper Sandler maintained his buy rating on Gracell, with a price target of $10.
Now what
The company's pipeline has 12 programs, including six potential indications for GC012F. That the therapy has shown a strong safety profile, as well as long-term efficacy, is a big deal, but it is still in early-stage trials.
It's also worth noting that the small patient population size -- only nine participants -- means it may be difficult replicating GC012F's results in a larger relapsed/refractory B-cell non-Hodgkin's lymphoma patient group.
The company had, as of the first quarter, $186 million in cash, enough to probably finance operations into 2026.
