Olema Pharmaceuticals Offers Potential in Oncology with Palazestrant

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Written By Joel Gbolade

Olema Pharmaceuticals, Inc. is an oncology-focused clinical-stage development company. Recently, Olema’s stock saw a boost following Pfizer Inc.’s (PFE) positive study results on a similar candidate to Olema’s. Below is an analysis of Olema Pharmaceuticals and its investment prospects.

Focus on Advancing Cancer Treatment

Credits: DepositPhotos

Olema Pharmaceuticals is dedicated to advancing the standard of care for women living with cancer. The company’s primary product candidate, palazestrant (OP-1250), is an oral small molecule with dual activity as both a complete estrogen receptor antagonist (CERAN) and a selective estrogen receptor degrader (SERD).

Currently trading around $12.50 per share, Olema boasts a market capitalization of approximately $690 million.

The company is also working on an orally bioavailable KAT6 inhibitor named OP-3136, which is still in the early stages of development. Olema plans to submit an IND application for this compound later this year.

The recent boost in Olema’s stock was partly due to Pfizer’s Phase 1 data on their KAT6 inhibitor, highlighting the potential in this area.

Advancements with Palazestrant (OP-1250)

Palazestrant has received FDA Fast Track designation for the treatment of ER+/HER2- metastatic breast cancer, particularly for cases that have progressed following one or more lines of endocrine therapy, including at least one line with a CDK4/6 inhibitor.

Currently, palazestrant is under evaluation in a pivotal Phase 3 monotherapy clinical trial, OPERA-01, for second- and third-line treatment of ER+/HER2- advanced or metastatic breast cancer.

Additionally, Olema recently completed enrollment in a Phase 1b/2 clinical study, which involves 60 patients. This trial aims to evaluate palazestrant in combination with ribociclib and palbociclib (Ibrance).

There are several other ongoing studies involving OP-1250 in combination with CDK 4/6 inhibitors. A Phase 3 pivotal trial in combination with ribociclib is also in the planning stages.

Analyst Commentary and Financial Position

Analyst firms have shown considerable optimism about Olema’s prospects, especially following Pfizer’s recent trial results and Olema’s presentations at the ESMO Breast Cancer Annual Congress.

In June, four analyst firms, including Oppenheimer and Jefferies, issued or reiterated Buy ratings for OLMA, with price targets ranging from $21 to $30 per share.

Financially, Olema posted a net loss of $31 million for the first quarter. However, the company has a robust balance sheet with just under $250 million in cash and marketable securities.

Of note, a company director sold nearly 1.2 million shares of stock earlier this month, after purchasing approximately 630,000 shares in the last four months of 2023.

Investment Outlook

Since our last review in November, Olema’s stock has remained relatively stable. Palazestrant continues to show considerable potential, although the space is competitive. The market for ER+/HER2- metastatic breast cancer treatments is large and growing, providing significant opportunities.

With multiple potential catalysts and milestones on the horizon, strong analyst support, and a solid balance sheet, Olema is an interesting investment opportunity.


Credits: DepositPhotos

Olema Pharmaceuticals continues to hold promise in the oncology sector, particularly with its primary candidate, palazestrant. While the company faces

competition, the market’s size and growth potential provide ample opportunity. Investors should maintain a cautious eye on Olema, focusing on upcoming clinical data and developments to guide future investment decisions.


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