Needham initiated coverage on MoonLake Immunotherapeutics (NASDAQ:MLTX) with a Buy rating and a price target of $76.
The analysts Serge Belanger and Rohit Bhasin note the company's lead product developing sonelokimab (SLK), a dual IL-17A/-17F inhibitor nanobody for chronic dermatological ailments like hidradenitis suppurativa (HS) and psoriasis (PsO), outshining established biologics in terms of efficacy.
The analysts expound that SLK has positioned itself as a potential best-in-class treatment, boasting remarkable efficacy that surpasses that of well-known biologics.
The differentiation comes through its innovative approach of concurrently inhibiting both IL-17A and IL-17F, promising a robust and holistic mode of action.
What further adds to SLK's allure is its applicability to various indications, offering a collective market opportunity estimated at a substantial $30 billion.
Anticipated growth projections propel this figure even higher, with the market value expected to swell to a noteworthy $40 billion-$50 billion by the mid-2030s.
The analysts emphasize that the upcoming six months hold significant promise for MoonLake Immunotherapeutics. They anticipate a flurry of catalysts and news releases that could drive additional value.
Furthermore, this could amplify the company's desirability as an acquisition target for major pharmaceutical players deeply invested in these chronic indications, armed with a biologics portfolio.
Needham sees UCB SA's (OTC:UCBJY) (OTC:UCBJF) bimekizumab and izokibep by Acelyrin Inc (NASDAQ: SLRN) as the main competitors to SLK.
In late June, SLK demonstrated efficacy results in HS that appear superior to those of bimekizumab, and izokibep has yet to demonstrate placebo-controlled efficacy results that rival those of SLK or bimekizumab.
Price Action: MLTX shares are down 0.11% at $56.13 on the last check Thursday.