Rocket Pharmaceuticals, Inc.’s (NASDAQ:RCKT) prospects have taken a significant hit on the company being forced to halt research on its experimental gene therapy for Danon Disease. The decision comes on the experimental drug RP-A501, resulting in a serious adverse event that led to a patient’s demise. Likewise, Leerink Partners downgraded the stock to ‘Market Perform’ from an ‘Outperform’ and cut the price target to $8 from $37 on May 28.
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The downgrade comes on Rocket Pharmaceutical recording its biggest slump in the market. The stock lost more than 50% in market value after the US Food and Drug Administration placed a hold on phase 2 trials for the candidate drug. Rocket Pharmaceuticals’ webcast disclosed a serious adverse event (SAE), where a patient succumbed to acute systemic infection, leading to a clinical hold on the Phase 2 Danon disease program. It is a rare hereditary condition that results in gradual muscular weakening and damage to the heart muscle.
Leerink Partners insists the company needs to address safety uncertainties and resolve clinical hold for a favorable rating. In addition, Leerink Partners insists that Rocket Pharmaceuticals faces an uphill task of re-establishing investor confidence. That’s partly because the company needs to meet revised timelines for clinical programs, including LAD-I, Danon, and FA. Following the significant blow on the Danon Disease treatment, Rocket Pharmaceuticals has imploded to all-time lows. The stock is down by about 80% year to date.
Rocket Pharmaceuticals, Inc. is a late-stage biotechnology company dedicated to developing gene therapies for rare and life-threatening diseases in the U.S., advancing adeno-associated viral (AAV) and lentiviral (LV) programs to target cardiac and immune disorders. Its AAV pipeline includes treatments for Danon disease (RP-A501, Phase 2), Plakophilin-2 Arrhythmogenic Cardiomyopathy (RP-A601, Phase 1), and BAG3 Dilated Cardiomyopathy (preclinical). At the same time, its LV platform develops therapies for Leukocyte Adhesion Deficiency-I (RP-L201), Fanconi Anemia (RP-L102), and Pyruvate Kinase Deficiency (RP-L301), addressing critical immune and blood disorders.
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