Lazard Capital Markets Releases Report on $VSTM: "Buy" Rating, $11 Price, $20 Price Target

Verastem, Inc. (NASDAQ:VSTM) is a biopharmaceutical company focused on discovering and developing novel drugs that selectively target cancer stem cells. Cancer stem cells are an underlying cause of tumor recurrence and metastasis. Verastem is translating discoveries in cancer stem cell research into new medicines for the treatment of major cancers such as breast cancer.

Lazard Capital Markets has released a report about Verastem and assigned it a BUY rating with an $11 price and a $20 price target: "We believe VSTM shares will appeal to investors by virtue of the company’s world-class scientific founders, highly experienced management team, and a research focus that may possess the potential to dramatically change the manner in which cancer is treated."

The Investment Summary is as follows:

 "Founded by world-class cancer biologists and experienced venture capitalists, Verastem is developing small-molecule drugs for the treatment of cancer with the specific focus of targeting cancer stem cells (CSCs). The underpinning theory behind Verastem’s approach is that, while typical cancer therapies may be effective in killing mature and differentiated cancer cells, ineffective killing of CSCs may provide the means for the tumors to re-grow. To facilitate development of CSC-targeting therapies, Verastem’s founders developed technologies to manipulate the epithelial-to-mesenchymal transition (EMT) to create CSCs. With them, standard high-throughput screening processes are applied to identify promising leads. Capital raised in the company’s IPO should support activities through to potential human proof of concept (POC). If Verastem is successful in the development of drugs that target CSCs, we believe there may be a high level of interest from other biopharma industry companies focused on developing cancer therapies."

Read the full report below.  

Vstm report by lazard capital markets 3 15-12

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Lazard Capital Markets initiates coverage of $VSTM with "Buy" Rating, $20 price target

Verastem, Inc. (NASDAQ:VSTM) is a biopharmaceutical company focused on discovering and developing novel drugs that selectively target cancer stem cells. Cancer stem cells are an underlying cause of tumor recurrence and metastasis. Verastem is translating discoveries in cancer stem cell research into new medicines for the treatment of major cancers such as breast cancer.

Last week, Lazard Capital Markets initiated coverage of Verastem with a "Buy" rating and a $20 price target. 

Highlights of the report are as follows:

• We believe VSTM shares will appeal to investors by virtue of the company’s world-class scientific founders, highly experienced management team and a research focus that may possess the potential to dramatically change the manner in which cancer is treated. 
• Targeting CSCs could improve treatment outcomes. Verastem is pioneering the development of therapies that target cancer stem cells (CSCs). Emerging evidence suggests that, while standard cancer treatments may be effective at killing cancer non-stem cells, CSCs may survive, providing opportunities for re-growth. 
• Technology platform designed to provide steady supply of CSCs. Verastem’s proprietary technology platform allows for the production of stable CSCs. Identification of potent CSC-killing agents may be facilitated through standard high-throughput screening techniques.  
• VS-507 likely first in man for treating TNBC. Human testing of lead drug candidate VS-507 is expected to begin in 2012. A modulator of the Wnt signaling pathway, VS-507 will initially be tested for treating triple-negative breast cancer (TNBC). 
• Valuation and risks. Our $20 PT is derived from a DCF analysis that values VS-507 for treating TNBC. Risks include successful development and regulatory approval of drug candidates as well as market competition. 

Read the full report below. 

Initiating Coverage on Verastem - March 2012

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