Janux Therapeutics Stock Craters After ‘Positive’ Cancer Data. Why It’s Down 50%.

Janux Therapeutics shared its latest trial data for JANX007, a T-cell engager that directs the body’s immune cells toward cancer cells. (Photograph by Saul Loeb/AFP/Getty Images)

Key Points

• Janux Therapeutics drops sharply after releasing early-stage trial data for its prostate cancer treatment, JANX007.
• JANX007 showed anti-tumor activity with partial responses in 30% of patients and radiographic progression-free survival of 7.9 to 8.9 months.
• Analysts lowered price targets, citing limited incremental patient data and investor concerns about the drug’s competitiveness against Pluvicto.

Shares of Janux Therapeutics plunged after the biopharma company posted what it called “positive trial data” for a novel treatment in patients with late-stage prostate cancer.

Early-stage data released Monday pertaining to Janux’s novel immunotherapy, JANX007, showed “durable responses with a manageable safety profile,” the company said.

Anti-tumor activity was observed with confirmed and unconfirmed partial responses in 30% of evaluable patients. Radiographic progression-free survival, a measure of how long a treatment is effective, ranged from 7.9 months to 8.9 months.

JANX007 is a T-cell engager, or a type of immunotherapy that directs immune cells toward cancer cells to kill them. The treatment is designed to target PSMA, a protein expressed in prostate cancer tumors. Researchers are specifically interested to see how the treatment works in patients with metastatic castration-resistant prostate cancer, an advanced form of cancer that has spread to other parts of the body.

While Janux believes the latest data are “encouraging,” it wasn’t enough to impress investors, who might be waiting for a more meaningful update.

Shares cratered 50% on Tuesday, putting the stock on pace for its worst same-day percentage loss on record, according to Dow Jones Market Data. The S&P 500 was 0.3% higher.

Nearly a year ago, shares surged by double digits after Janux shared an earlier Phase I update for the drug, saying all trial patients had achieved a reduction in prostate-specific antigen levels of at least 50%.

While there were some bright points to the update, investor concerns are well-founded, Stifel analyst Stephan Willey wrote as he lowered his price target on the stock to $38 from $46 while maintaining a Buy rating. Janux has generated a “limited amount of incremental patient data” over the past 12 months, leaving many questions “still-outstanding,” Willey said.

H.C. Wainwright analyst Swayampakula Ramakanth slashed his price target to $45 from $70 and reaffirmed a Buy rating, citing “mixed” results and noting that the drug likely will be a show-me story until the dataset matures.

Investors are likely waiting to see how the treatment will shape up against Pluvicto, a target radiotherapy from Novartis that’s already on the market. In a later-stage trial, Pluvicto boasted a 49% overall response rate and a median rPFS of 11.6 months.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com