Kodiak Sciences Inc. (NASDAQ:KOD) saw its share price nearly triple on Monday to a near five-year high, as investors loaded positions to cheer strong clinical trial results for its wet AMD treatment candidate.
In intraday trading, the stock soared by as much as 196 percent before trimming gains to finish the session just up by 177.96 percent at $89.92 apiece.
The rally followed news that its therapy candidate, Zenkuda, did well in its phase 3 trial and could potentially become a new standard-of-care for wet AMD, having met the primary endpoint of demonstrating non-inferiority in vision gains compared to aflibercept.
Photo by Polina Tankilevitch on Pexels
Fewer Injections
The biggest selling point is that the therapy candidate could treat wet AMD with fewer injections, having worked quickly with vision improvements comparable to aflibercept during the initial treatment period.
Additionally, 54 percent of enrolled patients could go for six months between treatments by year one, and more than half of the patients made it to roughly one injection every six months while keeping their retina sufficiently dry.
Following the results, Kodiak Sciences Inc. said that it plans to submit data from the late-stage trial in the fourth quarter of the year, with a biologics license application (BLA) targeted later this year.
Price Target Cut
Following the results, investment firm Jefferies reduced its price target for the stock by 28 percent to $112 from $156 previously, while reaffirming its buy recommendation.
It said that the coverage reflected its belief that Kenzuda holds a best-in-class treatment potential and could shift the story toward a BLA and commercial execution, although real-world durability may differ.
Hedge Fund Conviction Weakens
Institutional sentiment appeared to have weakened for Kodiak Sciences Inc. in the second quarter of the year, as evidenced by the drop in committed capital despite an uptick in the number of hedge fund holders.
Data from Insider Monkey showed that during the period, 37 hedge funds held positions in the stock, up from 36 in the first quarter of the year.
However, their combined holdings dipped by 3 percent to $1.129 billion from $1.165 billion quarter-on-quarter.
As these predate the latest Zenkuda treatment trials, investors are expected to watch out for the latest 13F filings to determine whether the results helped improve overall sentiment for the stock.
Of its largest hedge fund holders, Baker Bros ranked first, owning $776 million, followed by Braidwell with $69.6 million, and Boxer Capital with $57.57 million.
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