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If you're an investor looking for stocks that can make dramatic gains in a short amount of time, you may have noticed a small-cap biopharmaceutical company called Instil Bio (NASDAQ: TIL) has been rocketing higher.
From Sept. 6 through Sept. 12, shares of the clinical-stage drugmaker shot about 235% higher. A big week raised its year-to-date gain to an eye-popping 510%, and investors are wondering if it can climb higher still.
Here's a quick look at what's been pushing up shares of Instil Bio and some of its challenges. Plus, I'll also measure the good news against the bad to see if everyday investors can reasonably expect this stock to continue climbing.
Why Instil Bio stock is soaring
At the beginning of 2024, Instil Bio was still trying to develop cell-based cancer therapies that rely on tumor-infiltrating lymphocytes, or TILs. In August, the company switched gears and in-licensed IMM2510, a bispecific antibody that targets programmed death ligand 1 (PD-L1) and vascular endothelial growth factor (VEGF).
Instil Bio's collaboration partner, ImmuneOnco Biopharmaceuticals, is headquartered in China where another bispecific antibody that targets PD1 and VEGF is already approved. Ivonescimab from Akeso earned marketing approval in May to treat second-line lung cancer patients in China.
Akeso's partner Summit Therapeutics (NASDAQ: SMMT) licensed rights to ivonescimab outside of China and Australia. It recently turned a lot of heads on Wall Street with positive results from a head-to-head study with the world's top-selling cancer therapy, Keytruda. In the Harmoni-2 trial, newly diagnosed lung cancer patients randomized to receive ivonescimab were 49% less likely to worsen than patients given Keytruda.
Instil Bio hasn't completed any clinical trials with IMM2510, and its partner has only completed a single-arm ascending dose study. Despite a lack of data, its similarity to ivonescimab is leading Wall Street analysts to assume it has a chance to eventually become a leading cancer therapy too.
At the beginning of September, you could have bought every outstanding share of Instil Bio for less than $100 million. Its market cap has soared, but it still seems very inexpensive for a company that could have a blockbuster drug in its development pipeline. This is why Baird analyst Jack Allen recently raised his price target on Instil Bio to $180 per share which implies a gain of 235% from its price at 9:40 a.m. ET on Friday, Sept. 13.
Why Instil Bio stock is super risky
Ivonescimab and IMM2510 are both bispecific antibodies with similar targets, but there are significant differences. For example, ivonescimab binds to VEGF-A exclusively, while IMM2510 binds to VEGF-A and VEGF-B. The differences could improve its function, but it's hard to tell with the limited data so far from Instil Bio and ImmuneOnco.