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Instil Bio's Cancer Drug: Jefferies Sees Over 300% Stock Upside

AInvestTuesday, Jan 7, 2025 2:20 pm ET
3min read


Instil Bio, Inc. (Nasdaq: TIL) has caught the attention of Jefferies analyst Kelly Shi, who upgraded the company's stock from Hold to Buy with a price target of $52, representing a potential 300% increase from the previous target of $11. The bullish outlook is driven by the promising potential of Instil Bio's investigational cancer drug, SYN2510, a PD-L1xVEGF bispecific antibody with significant clinical data updates and business development interest in this drug class.



In 2024, three deals with a total upfront of $1.4 billion and a deal value of $6.4 billion were announced, including SYN2510 (PD-L1xVEGF-trap), BioNTech's Biotheus deal for BNT327, and Merck's LM-299 deal. These deals mark the first big Pharma joining the fray, adding confidence in the mechanism of action. The PD-(L)1xVEGF class is expected to reach over $40 billion, similar to the PD-(L)1 class, further validating the potential of SYN2510.



Instil Bio's SYN2510 is the third US asset with a global trial planned in 2025, and the company's stock has already shown significant growth, up ~500% following the HARMONi-2 trial update. Jefferies analyst Kelly Shi expects two key upcoming catalysts in 2025: Ivonescimab HARMONi-2 overall survival data (expected in YE25/Early26) and first global Phase 3 data (expected in mid-25). Positive results from both could drive continued excitement and attract more deals in the space, further boosting Instil Bio's market position.

However, achieving the significant price target increase from $11 to $52 may face several risks and challenges. The success of SYN2510 depends on positive clinical data, which is uncertain until it's released. Competition in the PD-(L)1xVEGF class is intensifying, with big pharma joining the fray. Additionally, regulatory approval and market acceptance are not guaranteed. To mitigate these risks, investors should monitor clinical trial progress, assess competition, and stay informed about regulatory developments. Diversifying investments across multiple biotech companies can also help spread risk.

In conclusion, Instil Bio's SYN2510 is a promising contender in the PD-(L)1xVEGF class, with significant potential driven by clinical data updates and business development interest. Jefferies' bullish outlook on the company's stock, with a price target of $52, reflects the drug's potential and the broader market trends. However, investors should remain aware of the risks and challenges associated with the drug's development and the competitive landscape.
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