4D Molecular Therapeutics tumbles following mid-stage clinical study results

4D Molecular Therapeutics Inc. (FDMT) experienced an initial uptick following the release of encouraging mid-stage clinical study results for their 4D-150 gene therapy, followed by a significant decline.

After opening the session higher at $28.89 a share, the stock is now down almost 35% at $17.41.

According to RBC Capital, the data from the milder population extension cohort in the wAMD study shows promising efficacy and a mostly favorable safety profile, despite a minor safety issue.

In the open-label study, 4D-150 was tested at two dose levels with follow-ups over 24 weeks.

The high dose demonstrated that 77% of patients remained injection-free, with improvements noted in both visual acuity and retinal thickness. RBC Capital reported, “the high-dose demonstrated 77% of patients injection-free, +4.2 letters BCVA and -9.2 μm CST.”

On the safety front, the study revealed no significant inflammation at the high dose. However, one case of Grade 2 inflammation was observed at the lower dose, which the analysts note as the first instance ever reported for 4D-150.

RBC Capital highlighted, “this occurred in only 1 patient with a history of syphilis which may be confounding.”

Despite this, the overall safety profile remains strong, with the majority of patients showing no significant inflammation. The analysts emphasized that “98% had no inflammation beyond trace levels,” suggesting that the drug maintains a competitive edge in terms of safety and efficacy compared to other treatments.

RBC Capital remains optimistic about 4D-150’s potential, setting a price target of $40 and affirming an Outperform rating. They expect some market volatility but advise investors to remain positive, citing the therapy’s best-in-class status in safety, efficacy, and potency.

Overall, RBC Capital’s analysis shows the bank believes 4D-150 is a promising candidate in the gene therapy landscape, bolstered by strong mid-stage study results and a robust safety profile, making it a worthwhile pursuit for further pivotal studies.