Shares of Juno Therapeutics Inc (NASDAQ:JUNO) stock shot nearly 30% higher in Tuesday’s after-hours trading after the company announced a favorable ruling by the U.S. Food and Drug Administration concerning Juno’s cancer drug, JCAR015.
The jolt to JUNO stock came as Juno Therapeutics received permission from the FDA to resume a Phase II clinical trial of JCAR015. This comes less than a week after the trial was put on hold following the death of three patients.
Juno is testing the drugs’s efficacy on adult patients with relapsed or refractory B cell acute lymphoblastic leukemia.
According to a release, “Under the revised protocol, the ROCKET trial will continue enrollment using JCAR015 with cyclophosphamide pre-conditioning only.” The revised protocol is a response to the three deaths, which Juno said happened after the “recent addition of fludarabine to the pre-conditioning regimen.”
JUNO stock tanked by 30% on July 8 after the company’s announcement of the suspended trial. That was followed up with several bearish analyst notes.
JPMorgan analyst Cory Kasimov downgraded Juno Therapeutics to “Neutral” from “Overweight” and cut its price target to $39 per share from $64. Raymond James cut its target to $44 from $52, while Goldman Sachs cut its target from $39 to $36.
Said JPMorgan’s team:
“Bottom line, we still have high hopes for JUNO’s CAR-T platform, but given the near/medium-term uncertainty, we see better opportunities elsewhere in our universe and are downgrading to Neutral.”
Meanwhile, Goldman Sachs knocked down the probability of success for JCAR015 to 60% from 85%.
As of this writing, Robert Martin did not hold a position in any of the aforementioned securities.
