RBC Capital has initiated coverage on Bicycle Therapeutics PLC (BCYC), a biotechnology company developing novel therapies for cancer and other diseases. The analyst, in their initiation report, highlighted the strong potential of Zelenectide pevedotin (zele), Bicycle Therapeutics’ lead program, to compete effectively in the oncology market.
Zele, formerly known as BT8009, has shown promising results in clinical trials for metastatic urothelial cancer (mUC), a type of bladder cancer. The analyst noted that Zele exhibited similar objective response rates to Padcev, a drug marketed by Pfizer Inc. and Seagen Inc., but with fewer adverse events. This improved safety profile could translate to greater antitumor durability, a key advantage for patients.
The analyst believes that Zele could have a significant market opportunity in mUC, with an estimated peak global sales of ~$2 billion in 2033. Furthermore, they see potential for Zele beyond mUC in other solid tumors, such as triple-negative breast cancer (TNBC) and non-small cell lung cancer (NSCLC), where Padcev has yet to demonstrate efficacy.
RBC Capital’s proprietary oncologist survey indicated strong demand for a safer Nectin-4 drug conjugate, which Zele represents. The analyst sees the regulatory path for Zele as de-risked following alignment with the FDA on the Duravelo-2 trial.
Beyond Zele, Bicycle Therapeutics has a promising pipeline with two additional clinical-stage candidates, exhibiting early signs of activity and safety in treating solid tumors. The company’s Bicycle platform, validated through clinical data from its internal pipeline and various external partnerships, has generated over $200 million in non-dilutive capital. Future value creation is expected from next-generation Bicycle Toxin Conjugates (BTCs), radiopharmaceutical applications, and expansion into therapeutic areas beyond oncology.
As of June 30, 2024, Bicycle Therapeutics had $961.4 million in cash and cash equivalents, providing a cash runway into the second half of 2027. The analyst initiated coverage on BCYC with an Outperform rating and a price target of $35.
On Friday, BCYC stock closed at $20.69, up 1.27%.
