What happened
Shares of Structure Therapeutics (GPCR -0.10%) 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.
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.
