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Bluebird Heading Into 'Catalyst-Rich' Second Half Of The Year

The gene therapy, cancer immunotherapy and gene editing platforms would provide catalysts for bluebird bio Inc BLUE in the back half of this year, Goldman Sachs’ Salveen Richter said in a report. He maintained a Buy rating on the company, with a price target of $135.

Bluebird’s shares have traded in-line with the NBI year-to-date, down 16 percent, and are trading significant short of their all-time high of $194. The downside has been driven by “a news vacuum and need for pipeline clarity,” analyst Richter mentioned.

Value Inflection

Bluebird seems to be entering a “key value-inflection point,” Richter commented, citing the reasons as:

  1. A more potent gene therapy entering the clinic with a full LentiGlobin update at ASH
  2. Unveiling of the CAR T and gene editing programs
  3. Two pivotal reads in mid-2017 and beyond, resulting in a “transition to commercial focus”

“BLUE’s more potent Gen2 LentiGlobin is slated to enter the clinic in 2H16 in the global pivotal beta-thal (HGB-207) and US Ph1 sickle cell disease (SCD, HGB-206) studies pending FDA go-ahead – should serve as a catalyst,” the analyst wrote.

Drug vector copy number data, which compares the existing drug versus Gen2 in same patient cells would provide insights into efficacy in Q4. ASH is scheduled for December 3-7 and LentiGlobin updates are expected at the event. “Lead CAR T bb2121, a key focus for investors, will likely read out in 2017 (potentially earlier),” Richter added.

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