• Raymond James downgraded Landos Biopharma Inc (NASDAQ: LABP) to Market Perform from Outperform following 2Q22 earnings and the first look at NX-13 Phase 1b data in ulcerative colitis (UC).

• The analyst's rating change is driven by:

  • Unclear strategy for omilancor in UC/Crohn's Disease (CD) (formulation optimization needed to improve solubility).

  • Lack of conviction on NX-13's early efficacy data in UC until an adequately powered study is more clearly demonstrative of efficacy.

• The LAPB management team is acutely focused on prioritizing resources for their lead programs and expects to deliver a comprehensive pipeline update and strategy later this year.

• Raymond James maintains that omilancor is a promising molecule that could drive value in the coming 12-18 months. However, that depends on formulation changes and "making the cut" of the pipeline review.

• Earlier this month, Landos Biopharma announced topline results from its Phase 1b trial of NX-13 for ulcerative colitis as a once-daily oral therapy.

• The data showed that NX-13 was well tolerated following evaluation of multiple doses over four weeks compared with a placebo.

• Across the four cohorts, no serious adverse events were reported, consistent with earlier studies in healthy volunteers and preclinical models.

• The company ended the June quarter with cash, cash equivalents, and marketable securities of $55.8 million.

• Price Action: LABP shares closed down 1.85% at $1.06 on Friday.

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