Allogene Therapeutics (ALLO) is a San Diego, CA-based biopharmaceutical company, developing and commercializing genetically engineered allogenic T-cell therapies for cancer treatment.
The company has six pipeline candidates in the early stage of development, including five CAR T cell product candidates — ALLO-501, ALLO-501A, ALLO-605, ALLO-316 and ALLO-715 — and a monoclonal antibody (mAB), ALLO-647.
Last year, the company announced multiple data readouts from its clinical studies, demonstrating its pipeline's potential. Allogene has no marketed product in its portfolio.
Below, we discuss five reasons why adding this stock to your portfolio may prove beneficial in 2023.
Good Rank & Rising Estimates: In the past year, shares of Allogene have fallen 39.4% compared with the industry's 12.2% decline.
Image Source: Zacks Investment Research
Despite the poor price performance, ALLO carries a Zacks Rank #2 (Buy) at present. Its loss per share estimates have narrowed from $2.83 to $2.44 for 2023 and from $2.69 to $2.46 for 2024 in the past 60 days.
Our estimates for ALLO's collaboration revenues indicate a CAGR growth of 26% over the next three years.
Opportunity in Targeted Markets: Allogene is developing its allogenic CAR T therapies, targeting hematologic indications with a high unmet need. There are only a few therapies available for hematologic malignancies. Allogenic CAR T therapies will likely serve a larger patient population than autologous CAR T therapies, given the latter's manufacturing limitations.
Promising Candidates for Treating NHL: NHL is the most common hematological malignancy in the United States, with more than 60 subtypes, the most common being B-cell. ALLO-501 and ALLO-501A are Allogene's most advanced product candidates designed to target the CD19 protein expressed on B-cells' cell surface.
The company started the pivotal phase II portion of the ALPHA2 study in October last year. It is aimed at evaluating ALLO-501A in patients with r/r large B cell lymphoma (LBCL). Management is also preparing to start a late-stage study in the first half of 2024 to determine ALLO-501A in an earlier line of therapy for LBCL.
In November, Allogene reported longer-term follow-ups of participants who were previously treated in ALPHA and ALPHA2 studies that showed strong durability.
Deals to Boost Pipeline: ALLO has entered into agreements with different companies to accelerate pipeline growth and establish its leadership position in allogenic T-cell therapy. In 2018, the company acquired certain assets from Pfizer PFE related to developing and administering allogenic CAR T cells for cancer treatment. ALLO will pay Pfizer up to $840 million in regulatory fee and development.
Allogene also received an exclusive worldwide license from Cellectis for its TALEN gene-editing technology. The license is meant for developing allogenic T cell product candidates directed against 15 different cancer antigens.
Other Pipeline Candidates: Apart from NHL, the company is also developing engineered AlloCAR T therapy candidates for multiple myeloma (MM), clear cell renal cell carcinoma (ccRCC) and other cancer indications.
In November, Allogene reported a longer-term follow-up of participants previously treated in the ALLO-715 UNIVERSAL study. The study showed strong durability, especially when combined with a higher dose of ALLO-647. The company plans to start a pivotal phase II study evaluating ALLO-715 in r/r MM in the future.
ALLO-316, the company's first CAR T candidate for solid tumors is being evaluated in the TRAVERSE study in adults with advanced or metastatic ccRCC. The successful development of its candidates will boost ALLO's prospects.
Allogene Therapeutics is a promising biopharmaceutical company with a strong pipeline of genetically engineered allogenic T-cell therapies for cancer treatment. Despite the poor price performance of its shares, Allogene has a top rank. Its loss per share estimates have narrowed, suggesting positive growth prospects. The company's focus on developing CAR T therapies targeting hematologic indications with a high unmet need will boost its pipeline and expand market reach. ALLO’s collaborations with Pfizer and other companies will also contribute to this development. However, rising competition is a concern.
Currently, there are no approved allogenic CAR T therapies in the market. Several companies, including CRISPR Therapeutics CRSP and Intellia Therapeutics, are engaged in the development of such therapies. CRSP is developing two candidates for haematological and solid-tumor cancers. It plans to start early-stage studies on new CAR-T candidates — CTX112 (targeting CD19 antigen) and CTX131 (targeting CD70 antigen) — in the first half of 2023.
Allogene Therapeutics, Inc. Price and Consensus
Another Stock to Consider
Another top-ranked stock in the same sector is ADMA Biologics ADMA, carrying a Zacks Rank #2 at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
The loss per estimate for ADMA has narrowed from 19 cents to 14 cents for 2023 and from 3 cents to 2 cents for 2024 in the past 90 days. Shares of ADMA have risen 60.6% in the past year.
ADMA Biologics’ earnings beat estimates in three of the trailing four quarters and missed the mark in one, delivering an average surprise of 2.88%.
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