Shares of CG Oncology catapulted to a four-month high Monday after the biotech unveiled promising results for a Johnson & Johnson-rivaling bladder cancer treatment.
The companies are working on treatments for a form of non-muscle invasive bladder cancer. After two years, 34% of patients given CG's cretostimogene had a complete response — meaning all signs of their cancer disappeared. At the median, patients continued responding to the treatment for 27.9 months.
These demonstrate "emerging best-in-class durability signals," RBC Capital Markets analyst Gregory Renza said in a report.
CG Oncology stock soared 25%, closing at 27.96. At one point, shares were up as much as 44%. Shares gapped well above their 50-day moving average and briefly retook their 200-day line, according to MarketSurge chart analysis. The stock closed below its 200-day moving average, however. J&J stock rose a fraction to close at 155.34.
How CG Oncology Is Rivaling J&J
Investors were quick to compare CG's results to Johnson & Johnson's drug, TAR-200. After a year of treatment, 46% of patients completely responded to TAR-200. That matches the same 46% complete response rates from cretostimogene recipients.
The data may level the playing field for CG Oncology, Renza said.
This "leveling of a competitive landscape" in high-risk non-muscle invasive bladder cancer is "equally, if not more, important" for CG Oncology, Renza said. Prior to the American Urological Association's annual meeting, where the data was presented, the Street underappreciated cretostimogene, Renza said.
"With this update, we believe that is no longer the case," he said. "Furthermore, we note that Creto's durability profile may have an edge over TAR-200, with a 27.9 months (median duration of response) vs. 25.8 months for TAR-200."
"While our view has remained that the NMIBC market will be competitive, we now see CGON as having a better shot at capturing market share, based on its potentially differentiated durability profile," he said.
Renza kept his outperform rating and 66 price target on CG Oncology shares.
Follow Allison Gatlin on X/Twitter at @AGatlin_IBD.
