Investing.com -- UroGen Pharma Ltd (NASDAQ:URGN) stock surged 5.9% on Thursday following the announcement of positive preliminary results from its Phase 3 UTOPIA trial for UGN-103, a treatment for recurrent low-grade intermediate-risk non-muscle invasive bladder cancer.
The company reported a 77.8% three-month complete response rate in the trial, which is consistent with the 79.6% rate observed in the pivotal ENVISION trial for its FDA-approved treatment ZUSDURI. Additionally, the FDA agreed that results from the UTOPIA trial can support the submission of a New Drug Application for UGN-103, setting a path for potential approval in 2026.
UGN-103 is designed to offer improvements over ZUSDURI, including a shorter manufacturing process and simplified reconstitution procedure, while maintaining the company’s approach that enables prolonged drug exposure within the bladder. UroGen has two U.S. patents covering UGN-103 that expire in December 2041.
"The robust 77.8% three-month CR rate observed in the UTOPIA trial is highly encouraging and reinforces the potential of UGN-103 to deliver meaningful benefits to patients," said Liz Barrett, President and CEO of UroGen. "In addition, the FDA’s agreement that the UTOPIA trial can support the submission of an NDA for UGN-103 represents a significant regulatory milestone."
Following the announcement, D. Boral Capital analyst Jason Kolbert raised his price target on UroGen Pharma to $30.00 from $25.00 while maintaining a Buy rating. "We roll our valuation metrics forward one year, which drives a higher price target, now $33.00. We model multiple indications based on JELMYTO and ZUSDURI (UGN102) & 103. We apply varying probability-of-success factors, ranging from 90% to 30%, based on the probability of approval and the realization of market estimates. In addition to the POS factor, we apply a 30% discount rate (r) to our models. We assume additional capital will be raised in our final share count. We then use these projections for our Free Cash Flow to the Firm (FCFF), Discounted EPS (dEPS), and Sum-of-the-Parts (SOP) models, which are equal-weighted, averaged, and rounded to the nearest whole number to derive our 12-month price target of $33.00."
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