Foghorn Therapeutics Stock Slides On Cancer Drug Development Halt, But Retail Remains Upbeat
By Stocktwits Inc | First Published Dec 17, 2024, 1:05 AM ISTThe company stated that while clinical responses were observed, it decided to shift resources to its proprietary pipeline and collaborations with Eli Lilly.
Shares of Foghorn Therapeutics Inc. fell more than 3% on Monday afternoon, after hitting intraday lows last seen over 10 months ago.
The decline followed the company’s announcement to discontinue the independent development of its experimental drug FHD-286 in combination with decitabine for treating relapsed and/or refractory acute myeloid leukemia (AML).
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The company stated that while clinical responses were observed, it decided to shift resources to its proprietary pipeline and collaborations with Eli Lilly, including the clinical-stage SMARCA2 inhibitor FHD-909.
CEO Adrian Gottschalk said the company would focus on other programs like Selective CBP, EP300, and ARID1B alongside Lilly-supported developments.
Despite the setback, retail sentiment on Stocktwits turned ‘extremely bullish’ as message volume surged, indicating optimism about Foghorn’s remaining programs and collaboration potential.
Analysts at Jefferies lowered the stock’s price target to $14 from $18 but maintained a ‘Buy’ rating, citing the decision to halt FHD-286 as “unsurprising.”
The brokerage attributed this to the high efficacy benchmark set by venetoclax, the current standard of care for AML.
Jefferies described FHD-909 as the company’s primary value driver. The new target implies a potential 180% upside from current levels.
Foghorn reported $267.4 million in cash and equivalents as of September 30, 2024, which is expected to fund operations into 2027.
However, the company’s stock has lost over 20% year-to-date, reflecting investor concerns about its clinical pipeline.
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