RAPT Therapeutics Stock Surges Over 100%: What's Behind the Rally?

On Monday, December 24, 2024, RAPT Therapeutics (RAPT) stock soared over 100%, driven by a strategic partnership and a significant private placement. The biopharmaceutical company, focused on discovering, developing, and commercializing oral small molecule therapies, saw its shares skyrocket to $1.735, marking a substantial gain from the previous day's close.

The primary catalyst behind RAPT's stock surge was a strategic partnership with Shanghai Jemincare Pharmaceutical. The exclusive license agreement granted RAPT worldwide rights (excluding mainland China, Hong Kong, Macau, and Taiwan) to develop and commercialize RPT904, a novel anti-IgE monoclonal antibody. RPT904 targets allergic conditions such as asthma and chronic spontaneous urticaria (CSU), offering a potential alternative to omalizumab (Xolair). The deal brought a $35 million upfront payment, up to $672.5 million in regulatory and commercial milestone payments, and royalties on sales outside the Jemincare Territory.

RAPT plans to focus on developing RPT904 for food allergies, while Jemincare is conducting Phase 2 trials in China for asthma and CSU. Topline data for the asthma trial is expected in late 2025, and results for the CSU trial are anticipated in early 2026. Investors likely viewed this deal as a significant opportunity for RAPT to tap into the growing food allergy market, with omalizumab's recent approval and rapid uptake confirming the high unmet need and large opportunity in this space.



In addition to the strategic partnership, RAPT announced a private placement agreement with accredited investors valued at around $150 million. The agreement included the issuance of 100 million common shares priced at $0.85 each and pre-funded warrants for up to 76.45 million shares priced at $0.8499 each. The influx of capital from these investors, combined with the company's strategic partnerships and positive clinical trial results, contributed to the stock's over 100% gain on Monday.

The market reacted positively to RAPT's plans to develop RPT904 for food allergies, as the drug targets the same clinically validated epitope as omalizumab, with an extended half-life, potentially positioning it as a best-in-class treatment option. The partnership also includes a $35 million upfront payment, up to $672.5 million in regulatory and commercial milestone payments, and royalties on sales outside the Jemincare Territory.

In conclusion, RAPT Therapeutics' stock surge on Monday was driven by a strategic partnership with Shanghai Jemincare Pharmaceutical and a significant private placement agreement. The exclusive license agreement for RPT904, a novel anti-IgE monoclonal antibody, and the influx of capital from accredited investors contributed to the stock's over 100% gain. As RAPT continues to develop RPT904 and other pipeline assets, investors will likely monitor the company's progress and potential milestones, which could further impact the stock's performance.