Gritstone Oncology is a strong-buy. How much could it gain?

Gritstone Oncology is a strong-buy. How much could it gain?

Gritstone Oncology is a medical stock with great potential. This company aims to defeat cancer once and for all. To achieve this goal, it develops personalized immunotherapies and uses them to fight multiple cancer types.

Gritstone Oncology is testing the escalated Phase 1 dose of its SLATE (off-the-shelf cancer vaccine targeting shared neoantigens) and GRANITE (personalized vaccine targeting cancer neoantigens) in patients with advanced cancer. 

New data indicated that some patients had experienced prolonged stable disease or, in some cases, tumor regression. However, none had risen to the level of a RECIST response.

H.C. Wainwright’s analyst Sean Lee stated that SLATE and GRANITE both seem safe, and they showed encouraging signs of efficacy. That should warrant further study in larger patient populations.

Furthermore, SLATE and GRANITE are well-tolerated. Dose-limiting toxicities (DLTs) did not show up in the GRANITE study, while the SLATE study showed only two DLTs.

However, the stock declined by 50% on July 13, which has created an excellent buying opportunity. Currently, it’s selling for $3.45 per share. Several of Wall Street’s analysts noted that the share price has an attractive entry point.

What are Gritstone Oncology’s plans in the near future?

The company plans to begin Phase 2 studies for SLATE and GRANITE in advanced cancer in 2H20. Gritstone Oncology wants to evaluate the original cassette of SLATE (Cassette v1) in NSCLC patients with prior immunotherapy/chemotherapy and in ovarian cancer patients with the TP53 mutation. 

They will also test a new version of the SLATE cassette (Cassette v2). It is designed to optimize the immune response to KRAS mutations.

As for GRANITE, they will assess two cohorts of MSS-CRC patients with prior FOLFOX/FOLFIRI therapy as well as GEA patients with prior chemotherapy.

According to Gritstone Oncology, they will report data about the Phase 2 GRANITE study in 2H21. The company will report the results from Phase 2 studies of SLATE Cassette v1 and v2 in 1H21 and 2H21, respectively. 

Considering all this, Lee gave Gritstone Oncology a Buy rating. He set his price target at $16, with the potential to gain 365% over the year. 

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