On Monday, Stifel reaffirmed its Buy rating on shares of Rani Therapeutics Holdings (NASDAQ:RANI) with a steady price target of $10.00. The biopharmaceutical company has recently entered into a collaboration with South Korean biotech ProGen to co-develop an oral formulation of ProGen's drug, PG-102, for obesity treatment. This partnership is poised to utilize Rani Therapeutics' proprietary RaniPill delivery system.
The injectable version of PG-102 has shown promising results in Phase 1 trials, demonstrating good tolerability and weight loss comparable to the drug tirzepatide. Additionally, it has shown improved glycemic control and better fat-to-lean mass loss ratios. The drug's extended pharmacokinetic profiles could also lead to less frequent dosing requirements.
The financial terms of the partnership between Rani Therapeutics and ProGen indicate a mutually beneficial agreement with no upfront financial exchange. Both parties will share costs and revenues equally and will manage commercialization in their respective regions. Rani Therapeutics is set to lead the early development stages, with Phase 1 trials expected to start in 2025.
The collaboration is seen as a strategic move that could further validate the RaniPill delivery system's potential and facilitate Rani Therapeutics' entry into the substantial obesity market.
The RaniPill system, particularly with RT-114, is anticipated to offer a new dimension of differentiation by providing a more convenient once-weekly dosing option and significantly lower cost of goods sold per pill compared to other oral therapies available.
In other recent news, Rani Therapeutics Holdings and South Korean biotech firm ProGen Co. have announced a partnership to co-develop and commercialize RT-114, an oral therapeutic for obesity.
The collaboration will utilize Rani's RaniPill® capsule and ProGen's proprietary protein, PG-102. The companies have agreed to a 50/50 cost and revenue share arrangement for the worldwide development and commercialization of the product.
Rani Therapeutics recently disclosed its financial results for the first quarter of 2024, reporting a net loss of $0.56 per share. Following these results, H.C. Wainwright increased its price target for Rani Therapeutics from $12.00 to $13.00, maintaining a Buy rating on the company's shares.
Concurrently, Canaccord Genuity (TSX:CF) revised its financial outlook for Rani Therapeutics, reducing its price target from $21.00 to $9.00 due to a shift in the clinical development timeline of Rani Therapeutics' osteoporosis treatment candidate, RT-102.
Despite the revised timeline, Canaccord Genuity maintained a Buy rating on the company's shares, indicating its continued confidence in the potential of Rani Therapeutics' pipeline. These are the latest developments for Rani Therapeutics, reflecting the ongoing analysis and adjustments made by analysts at H.C. Wainwright and Canaccord Genuity.
InvestingPro Insights
As Stifel maintains a positive outlook on Rani Therapeutics Holdings (NASDAQ:RANI), recent metrics from InvestingPro reveal a mixed financial landscape for the company. Rani Therapeutics has experienced a notable 8.92% return over the last week, reflecting investor optimism possibly spurred by the new collaboration with ProGen.
This short-term gain complements the 27.3% return over the last three months, indicating a strong recent performance despite a challenging year-to-date return of -3.71%. Still, with a current market capitalization of $213.78M and a high Price / Book ratio of 29.17, the company is trading at a premium relative to its book value.
InvestingPro Tips suggest that while Rani Therapeutics is quickly burning through cash and suffers from weak gross profit margins, it does have liquid assets that exceed short-term obligations. This could offer some financial stability as the company embarks on its new partnership.
Moreover, the company operates with a moderate level of debt, which could be advantageous in managing financial risks. For investors seeking a more in-depth analysis, InvestingPro offers additional tips on the company's financial health and future outlook. To access these insights and take advantage of a special offer, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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