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Instil Bio Stock Skyrockets 641% in One Week: Here's Why

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Shares of small biotech Instil Bio (TIL - Free Report) have surged more than six times in market value in the past week.

The upside came after rival Summit Therapeutics (SMMT - Free Report) reported encouraging data from a late-stage study on its experimental bispecific antibody ivonescimab in certain patients with non-small cell lung cancer (NSCLC).

SMMT’s Drug Shows Meaningful Benefit Over MRK’s Keytruda

The phase III HARMONi-2 study compared ivonescimab with Merck’s (MRK - Free Report) blockbuster drug Keytruda (pembrolizumab) in patients with locally advanced or metastatic NSCLC whose tumors have positive PD-L1 expression.

Data from the study showed that the SMMT antibody reduced the risk of disease progression or death by nearly half compared with Keytruda. Patients who received ivonescimab achieved a median PFS of 11.14 months compared with 5.82 months for those receiving the blockbuster Merck drug. The overall response rate (ORR) and the disease control rate (DCR) were also higher in patients treated with ivonescimab.

Per SMMT, ivonescimab is the first drug to achieve a statistically significant improvement compared to Merck’s Keytruda in a head-to-head set-up in a late-stage study in NSCLC indication. Keytruda is also the standard of care in NSCLC indication.

But Why Did TIL Stock Went Soaring on Ivonescimab Data?

Last month, Instil Bio announced that it has entered into a license and collaboration deal with China-based ImmuneOnco. Per the agreement terms, TIL acquired exclusive rights to develop and market two antibody treatments outside China targeting cancer indications.

One of the in-licensed candidates, SYN-2510 (IMM2510), utilizes a mechanism similar to ivonescimab and targets two proteins — PD-L1 and VEGF. Post the release of Summit Therapeutics’ results, several Wall Street analysts pointed out that ivonescimab could replace Keytruda as the next standard of care across multiple NSCLC settings.

Unlike Keytruda, which targets the PD-1/PD-L1 protein, SYN-2510 targets two proteins, namely PD-L1 and VEGF. Some Wall Street analysts pointed out that this dual mechanism differentiates the TIL and SMMT drugs from currently available therapies for solid tumors as there is a potentially higher expression of PD-1/PD-L1 and VEGF in tumor tissue compared to the normal tissues in the body. These analysts were also impressed with SYN-2510 as it has shown the potential to block VEGF-A and VEGF-B, compared to ivonescimab, which only blocks VEGF-A.

Year to date, Instil Bio’s shares have skyrocketed more than 1,000% compared with the industry’s 0.5% growth. During this timeframe, the stock has also outperformed the sector and the S&P 500. The company’s shares are also trading above the 50-day and 200-day moving averages.

Instil Bio’s Stock Outperforms Industry, Sector & S&P 500

Zacks Investment Research
Image Source: Zacks Investment Research

Our Take on TIL Stock

A new investor should exercise caution when investing in the TIL stock. The similarity between SYN-2510 and ivonescimab mainly drives this surge in share price. It is still too early to judge the performance between the two drugs – SYN-2510 is still in early-stage development and Instil Bio is yet to complete a clinical study on the drug. Investing in a biotech with an early-stage pipeline is risky. We advise investors to wait and watch for a couple of pipeline updates before investing in the stock.

Earlier today, Instil Bio announced that it is prioritizing the development of SYN-2510 in NSCLC and triple-negative breast cancer (TNBC) indications. Management plans to file an investigational new drug (IND) application with the FDA to start a mid-stage study on the drug in second-line non-squamous and squamous NSCLC by this year’s end.

TIL Zacks Rank

Instil Bio currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.

 

Our Key Pick Among Drug Stocks

A better-ranked stock is Bioventus (BVS - Free Report) , which sports a Zacks Rank #1 (Strong Buy) at present.

In the past 60 days, estimates for Bioventus’ 2024 earnings per share have risen from 27 cents to 40 cents. Estimates for 2025 have increased from 43 cents to 45 cents during the same period. Year to date, shares of Bioventus have surged 111.9%.

BVS’ earnings beat estimates in three of the last four quarters and missed the mark on one occasion. Bioventus delivered a four-quarter average earnings surprise of 102.86%.

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