XTL Biopharmaceuticals Aims To Tame Lupus, HC Wainwright Initiates At Buy

In a report published Friday, analyst Swayampakula Ramakanth of HC Wainwright & Co initiated coverage of XTL Biopharmaceuticals Ltd (NASDAQ: XTLB) with a Buy rating and a price target of $6.

Of the three product candidates the company currently has, Edratide is a lead product and targets a chronic and severe disease via a novel action mechanism. The disease has a high unmet need and the analysts estimate the worldwide market for the drug at $3.8 billion.

Edratide is in clinical trials for the treatment of SLE, an autoimmune disease that can affect multiple organs and is currently believed to be a result of anti-nuclear auto-antibodies. These auto-antibodies are believed to elicit serious immune reactions that are for now treated with steroids and other immunosuppressants.

Edratide, however, is a peptide that has been designed to help the immune system tolerate the presence of auto-antibodies. Therefore, this drug could not only help curb the immune reactions, it could also reduce the need to use steroids. Steroid use has been the primary reason for morbidity and mortality in people suffering from SLE. In addition, Edratide's unique action mechanism might allow it to be used in conjunction with new, emerging treatments.

"Management plans to initiate a Phase 2b study of Edratide in early 2016. We anticipate Edratide to enter the market in 2020 and project annual risk-adjusted revenues of $347M by 2025," the analysts said.