Dicerna Pharma Has Multiple Pipeline Opportunities, Tough Competition, Analyst Says In Neutral Initiation

Dicerna Pharmaceuticals Inc (NASDAQ: DRNA), a biotechnology company developing GalXC RNAi platforms for various diseases, has seen its stock soar 140 percent over the past six months. But a combination of good news and bad news should leave investors on the sidelines, according to B. Riley FBR.

The Analyst

B Riley FBR's Madhu Kumar initiated coverage of Dicerna Pharmaceuticals' stock with a Neutral rating and $10 price target.

The Thesis

Dicerna's stock is a story of good news and bad news, Kumar said in a Tuesday report. On the positive side, Dicerna's GalXC RNAi platform boasts "multiple shots on goal" in both orphan and non-orphan diseases. The company's lead asset, DCR-PHXC for the treatment of primary hyperoxaluria, is currently undergoing Phase 1 trials. DCR-HBVS for the treatment of hepatitis B has guided an investigational new drug designation for the fourth quarter.

"Overall, Dicerna has a liver-directed RNAi platform with multiple clinical entrants expected in 2018," Kumar said. 

On the bearish side, the analyst is "cautious" on the company's PH RNAi program, as early, striking safety and efficacy data from a competing drug, Alnylam's lumasiran, implies Dicerna has "little margin for error" in its study, the analyst said.

This could limit upside in Dicerna's stock ahead of the initial Phase 1 DCR-PHXC results in the bottom half of 2018, according to B Riley FBR. 

Price Action

Shares of Dicerna Pharmaceuticals were down 8.2 percent to $9.18 at the time of publication Wednesday.

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