Encouraging progress, but Applied Genetics still has questions to answer

Applied Genetic Technologies’ shares more than doubled yesterday on encouraging data from its retinitis pigmentosa gene therapy. But the jump left AGT capitalised at a mere $169m, a relatively tiny sum for a company that is working with a technology generating much investor excitement – and interest from buyers. Biogen, which now owns AGT’s direct rival Nightstarx, walked away from a deal with AGT that included this project in late 2018, helping to explain the low valuation. The data released yesterday were largely a confirmation of earlier findings, but in a few more patients, with some tracked a little longer. 25 subjects with X-linked retinitis pigmentosa caused by mutations in RPGR have been treated with the XLRP project so far; AGT said yesterday that, of the eight patients that have been followed for six months so far, half showed a sustained increase in visual sensitivity. The crucial question now is why some patients are not responding, and on that there is no answer yet. A pivotal trial is to start by the end of the year, but the company needs to figure out how to identify these non-responders before real progress can be made.