Investing.com – H.C. Wainwright downgraded Evommune Inc (NYSE:EVMN) to Neutral from Buy following the failure of the company’s Phase 2b trial in chronic spontaneous urticaria.
The firm’s analyst Mitchell Kapoor said EVO756 failed to meet the Phase 2b primary endpoint of mean change in UAS7 at Week 12 in moderate-to-severe antihistamine-refractory CSU across all tested doses. Evommune management no longer plans to pursue CSU development. The stock plunged 38% in the past week to $15.05, though InvestingPro data suggests the company may now be undervalued relative to its Fair Value analysis.
CSU was the lead indication for EVO756 and the primary value driver for MRGPRX2 before the EVO301 IL-18 atopic dermatitis program created a dual-threat setup in dermatology. The analyst removed the CSU MRGPRX2 opportunity from the firm’s model and downgraded to Neutral without a price target.
The analyst said the stock is no longer supported by two credible mid-stage mechanisms. The remaining upside case rests more heavily on IL-18 execution in atopic dermatitis and conversion of IV success to a subcutaneous product.
H.C. Wainwright does not see a compelling risk/reward profile until EVO301 builds clearer momentum on subcutaneous translation, durability, and competitive positioning. The firm’s other estimates remain unchanged. Despite the setback, InvestingPro Tips highlight that Evommune holds more cash than debt and maintains liquid assets exceeding short-term obligations, with 8 additional tips available to subscribers.
In other recent news, Evommune, Inc. announced that its Phase 2b trial for EVO756 in treating chronic spontaneous urticaria did not meet its primary endpoint. The trial, which involved 160 patients across the United States, Europe, Canada, and Japan, aimed to evaluate the mean change in Urticaria Activity Score over seven days at 12 weeks. Following this announcement, Raymond James downgraded Evommune’s stock rating to Outperform from Strong Buy, reducing its price target to $32 from $52. Similarly, William Blair downgraded the stock to Market Perform from Outperform, citing the removal of EVO756 from its valuation and expressing low expectations for a separate trial in atopic dermatitis. Despite these setbacks, H.C. Wainwright maintained a Buy rating with a $50 price target, highlighting the trial’s completion and its potential to inform future Phase 3 studies. These recent developments have drawn significant attention from investors and analysts alike.
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