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Arcellx (ACLX) Up 5% on Partnership Expansion With Gilead

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Shares of Arcellx (ACLX - Free Report) moved up 5.3% on Wednesday after the company announced that it is expanding its existing partnership with Kite, a wholly-owned subsidiary of Gilead Sciences (GILD - Free Report) .

The Gilead subsidiary and Arcellx initially entered into a strategic partnership last year in December to co-develop and co-commercialize the latter’s lead late-stage product candidate, CART-ddBCMA, in multiple myeloma (“MM”). Following the expansion of the collaboration scope, the companies will develop CART-ddBCMA to treat lymphomas.

Kite also exercised its option to negotiate a license for Arcellx's ARC-SparX program, ACLX-001, in MM indication. A CAR-T cell therapy, ACLX-001, comprises ARC-T cells and SparX proteins that target BCMA.

The deal is expected to close before this year’s end. Upon closing, Arcellx will receive a $200-million equity investment from Gilead, after which the latter will own a 13% stake in the former. Kite will also make an upfront cash payment of $85 million to the company.

These funds will enable Arcellx to expand its cash runway into 2027. The terms of the new deal also make the company eligible for receiving milestone payments.

Year to date, shares of Arcellx have surged 61.4% against the industry’s 22.5% fall.

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CART-ddBCMA is Arcellx's BCMA-specific CAR-modified T-cell therapy utilizing Arcellx's novel BCMA-targeting binding domain. The candidate is being evaluated in the pivotal phase II iMMagine-1 study as a potential treatment for adult patients with relapsed or refractory MM (“rrMM”).

ACLX-001 is being evaluated in a phase I study for the treatment of rrMM. Like CART-ddBCMA, it utilizes the same novel BCMA-targeting binding domain.

Apart from the above two, Arcellx is developing ACLX-002, another CAR-T cell therapy, in an early-stage study to treat high-risk myelodysplastic syndrome (MDS).


Zacks Rank & Stocks to Consider

Arcellx currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the overall healthcare sector include Apellis Pharmaceuticals (APLS - Free Report) and Biohaven (BHVN - Free Report) , also carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Apellis Pharmaceuticals’ loss estimates for 2023 have narrowed from $4.89 to $4.59 per share in the past 60 days. During the same period, the estimates for 2024 loss per share have narrowed from $2.77 to $1.92. Year to date, Apellis Pharmaceuticals’ shares have lost 6.4%.

Apellis Pharmaceuticals beat earnings estimates in two of the last four quarters while missing the mark on the other two occasions, witnessing a negative earnings surprise of 3.91% on average. In the last reported quarter, APLS reported a negative earnings surprise of 39.29%.

Biohaven’s loss estimate has narrowed from $4.99 to $4.93 per share in the past 30 days. During the same period, the loss estimates per share for 2024 have narrowed from $4.81 to $4.79. Shares of BHVN have surged 109.3% in the year-to-date period.

The earnings of Biohaven beat estimates in one of the last four quarters while missing the mark on the other three occasions, posting a negative average earnings surprise of 40.27%. Biohaven’s earnings missed estimates by 12.78%.

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