Shares of Relay Therapeutics, Inc. (NASDAQ: RLAY) rose by 52.8 per cent on Monday after news broke of positive interim data for its breast cancer treatment RLY-2608.
The data revealed a 9.2-month progression-free survival (PFS) and a 33 per cent objective response rate (ORR), both of which are clinically significant metrics in oncology. These results not only validate the drug’s potential efficacy but also boost investor confidence in Relay Therapeutics’ AI-driven drug discovery platform.
Investors have shifted toward favouring companies like Relay Therapeutics, which demonstrate real-world progress with AI platforms, contrasting with mixed outcomes from competitors like Recursion Pharmaceuticals (NASDAQ: RXRX).
Several analysts upgraded their price targets for Relay Therapeutics based on the release.
Barclays, for example, maintained a Buy rating with a target price of USD$14, citing strong clinical results.
RLY-2608 is Relay Therapeutics’ main program focused on creating treatments that target PI3Kα, a gene that is the most commonly mutated in cancer. About 14 per cent of people with solid tumors have these mutations. If approved, RLY-2608 could potentially help more than 300,000 patients in the U.S. each year, making it a major breakthrough in precision cancer treatment.
“These interim data suggest that by selectively targeting mutant PI3Kα, RLY-2608 has the potential to offer a level of benefit to patients that has not previously been possible with existing non-selective medicines, while also having significantly less toxicity,” said Don Bergstrom, president of R&D at Relay Therapeutics.
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Relay integrates computational and experimental tech
Relay Therapeutics is a clinical-stage precision medicine company that focuses on transforming drug discovery by integrating advanced computational and experimental technologies. Furthermore, the company uses a unique approach, combining data-driven insights with machine learning and molecular simulations, to design and develop new therapies.
Relay targets specific genetic mutations and disease pathways, aiming to create more effective and selective treatments for conditions like cancer. The company strives to accelerate the drug development process and improve patient outcomes through the use of cutting-edge tools.
The biotech sector, especially companies developing promising oncology drugs, frequently experiences significant volatility. Positive news can trigger rapid stock price increases due to the high-risk, high-reward nature of the industry. Investor hopes for future FDA approvals or partnerships are often what fuels speculative buying.
The broader market’s interest in biotech stocks, particularly those focused on innovative drug discovery methods, also plays a role.
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