Cidara Therapeutics: A High-Conviction Biotech Buy in the Undervalued Antifungal Space

In the ever-evolving biotech landscape, Cidara Therapeutics (NASDAQ: CDTX) stands out as a compelling investment opportunity, driven by its innovative pipeline and strategic realignment. Recent analyst activity, including Morgan Stanley's high-conviction "overweight" rating with a $190 price target (implying a 79.89% upside from its October 15, 2025, closing price), underscores the company's potential to deliver outsized returns, according to Morgan Stanley's initiation of coverage. While much of the current focus centers on CD388, Cidara's long-acting antiviral influenza prophylactic, the company's legacy in antifungal innovation-and its forward-looking platform-position it as a hidden gem in a critically underserved therapeutic area.

Strategic Realignment and Financial Resilience

Cidara's decision to divest its antifungal flagship, rezafungin (Rezzayo), to Mundipharma in April 2024 was a masterstroke; as Cidara announced the divestiture, the move freed up approximately $128 million in cost savings over the drug's patent life, including $67 million in clinical development costs and $61 million in forecasted obligations. By shedding rezafungin-a drug that became the first new treatment for candidemia and invasive candidiasis in over a decade, following the FDA approval of rezafungin-Cidara redirected resources toward its proprietary Cloudbreak® platform, which generates drug-Fc conjugates (DFCs) for oncology and infectious diseases. This platform, which combines small molecules with antibody fragments to enhance targeting and efficacy, represents a paradigm shift in therapeutic development, as described on Cidara's pipeline.

The financial discipline demonstrated by Cidara has already borne fruit. A $402.5 million public offering in June 2025, detailed in Cidara's corporate update, and a $240 million private investment in public equity (PIPE) deal, reported in the PIPE announcement, have fortified its balance sheet, enabling aggressive advancement of CD388 and CBO421, its lead oncology candidate. These moves highlight Cidara's ability to execute on capital-raising while maintaining a lean operational structure-a critical trait in biotech's high-risk, high-reward environment.

Antifungal Legacy and Future Potential

Though Cidara no longer owns rezafungin, its antifungal heritage remains a cornerstone of its value proposition. Rezafungin's once-weekly dosing regimen, approved by the FDA in 2023, addressed a major unmet need in treating drug-resistant fungal infections like Candida auris. Pooled analyses from the STRIVE and ReSTORE trials demonstrated its non-inferiority to caspofungin, with superior outcomes for Candida glabrata infections, as shown in the STRIVE and ReSTORE pooled analyses. This track record validates Cidara's ability to innovate in antifungal therapeutics, even as it pivots to new modalities.

Critically, the Cloudbreak platform's versatility suggests antifungal applications could resurface. Drug-Fc conjugates are designed to target pathogens with precision while minimizing off-target effects-a trait highly desirable in antifungal development, where toxicity often limits treatment options. While Cidara's current pipeline prioritizes oncology and antivirals, the platform's foundational science leaves room for future antifungal candidates, particularly as drug-resistant fungal infections escalate globally, as noted in the Patsnap profile.

Morgan Stanley's Endorsement and Market Dynamics

Morgan Stanley's initiation of coverage on Cidara reflects confidence in both CD388's commercial potential and the company's broader innovation thesis. CD388's Phase 2b NAVIGATE trial results-showing 76.1% prevention efficacy at the highest dose-have positioned it as a universal flu preventative complementary to vaccines, according to the CD388 Phase 2b results. With interim Phase 3 results expected in June 2026, the drug's regulatory pathway appears robust. However, the analyst's "overweight" rating also implicitly acknowledges Cidara's historical strengths in antifungal R&D, which differentiate it from peers focused solely on viral or oncologic pipelines.

The antifungal market, though less glamorous than oncology or gene therapy, remains chronically underinvested. Rezafungin's success demonstrated that novel antifungals can achieve commercial viability, particularly in hospitals treating immunocompromised patients. Cidara's expertise in this niche, combined with its platform's scalability, creates a flywheel effect: lessons from antifungal development can inform DFC design for other diseases, and vice versa.

Risks and Mitigants

As with any biotech play, Cidara faces risks, including clinical trial delays and competitive pressures in the influenza space. However, its financial runway (supported by recent capital raises) and the defensible IP around Cloudbreak mitigate these concerns. Moreover, the company's strategic focus on high-unmet-need indications-such as pandemic influenza prevention and oncology-reduces exposure to commoditization.

Conclusion: A Buy for the Long-Term Visionary

Cidara Therapeutics is more than a single-product story. Its antifungal legacy, platform innovation, and strategic agility make it a rare biotech play that balances near-term catalysts (CD388's Phase 3 trial) with long-term potential. For investors seeking exposure to undervalued innovation, CDTX offers a compelling case: a company that has proven its ability to disrupt one therapeutic area (antifungals) while building the tools to do so in others. Morgan Stanley's endorsement is not just a vote of confidence in CD388-it's a recognition of Cidara's broader, underappreciated potential.