Tobira 2.0 – Could Galectin Therapeutics Inc (NASDAQ:GALT) Be the Next Tobira?

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In the biotech sector, we could be about to see a case of history repeating. Could Galectin Therapeutics Inc (NASDAQ:GALT) be Tobira 2.0? NASH is a chronic liver disease. Before you get NASH, you get something called nonalcoholic fatty liver disease (NAFLD), which is an accumulation of fat in spots where cells have died due to inflammation. NASH slowly transitions into fibrosis (could take up to two decades in some extreme cases) and then transitions to cirrhosis in about 25% of patients. This disease is thought to cause damage on the order of $600M a year. There are no drugs currently approved to treat this disease. As the population increases, so will the market for NASH treatment which is estimated to be $1.3 Bill in 2017. There is a race to be first to market with a viable treatment and Galectin Therapeutics Inc (NASDAQ:GALT) with its galectin inhibitors is a prime candidate. This is a drug with an attractive valuation which is arguably even better than Tobira’s was before its buyout.

Let’s look at the Tobira acquisition by Allergan ($AGN). They bought the company in Phase 3 even as it was failing to meet clinical endpoints, for $1.7 billion. Contrasted with GALT, which is presently finishing up its phase II study- if the endpoints of this study are met within the next 10 months, it is a virtual lock for regulatory approval. Comparable valuation of this company could be close to $1.7 billion, which would represent a target price of $53/share.

There is also a billionaire investor involved with Galectin Therapeutics Inc (NASDAQ:GALT): Richard Uihlein. He owns Uline, a shipping supplies company. He was very influential in getting republican Scott Walker elected as governor of Wisconsin, and was named one of the top 20 most powerful political insiders. His initial investment was a year after the NASDAQ listing at $6/share, with additional investments after the FX trial in 2016, and another at the end of 2016. His total stake in the company approaches 8%. Even more impressive and telling is that he didn’t sell when the stock was at $19.

When you really look closely at GALT you see that it is the ONLY public company with a galectin blocker drug even close to marketing approval. At the GTC Bio Conference, GALT’s results excited investors as their Galectin Blocker GM-MD-02 pits 3 drug giants, Merck ($MRK), Bristol Meyers ($BMY), and Roche ($RHHBY) against each other to make a play on these assets.

The pipeline at GALT is impressive because Galectins are implicated in so many chronic diseases, including cancer. NASH is only one subset of liver disease. What about Alcoholic Liver Disease (ALD)? The same mechanism of action that reversed fibrosis in NASH could also work in ALD. Almost all organ fibrosis is linked to the Galectin-3 receptor, so that means Pulmonary, Kidney, and Heart disease could come next.

It doesn’t take much imagination to see the potential of this company on so many fronts. GALT has more going for it than Tobira. They have a safer drug with more robust preclinical data. The company has a platform technology that once approved can go over multiple indications in organ fibrosis and cancer. On top of all that, the stock is extremely undervalued. Tobira went from under $2 to $44, and when it’s all said and done… GALT could be next Tobira, or as we’ve deemed it- Tobira 2.0!

 

Despite all of the tantalizing facts on GALT that you read above, the reality remains that it is mostly speculation at this point, without so much as a credible rumor of a buyout so far. That being said, it’s always important to use your powers of foresight, and as we laid out here, GALT is a prime candidate for a future deal that could see it go the way of Tobira. We’ll be sure to keep our ears to the tracks here on Street Register, and pass along any new developments that occur in GALT. Be sure you’re signed up to our 100% free penny stock newsletter to stay up to date with GALT, by simply entering your email into the box below and hitting Subscribe Now!

1 COMMENT

  1. Great article! Its truly amazing that some many names like Bristol Meyers, Merck, Roche, Allergan, and even Seattle Genetics need this platform technology. This is a rare find because GALT seems to be the only public company with a viable galectin inhibitor. The question is which company is going to be the first to party.

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