GERN: Expanded Blood Cancer Indications Will Drive Upside Despite Safety Concerns

Analysts have trimmed their price target on Geron from approximately 6.00 dollars to 5.00 dollars, citing a higher perceived risk profile and more conservative expectations for revenue growth and profitability.

What's in the News

• New data from the 67th American Society of Hematology 2025 Annual Meeting highlighted Geron’s completion of the Part 1 dose escalation phase, establishing 8.9 mg/kg IV every 4 weeks as the recommended imetelstat dose with ruxolitinib in combination studies (Key Developments)
• Interim results from an investigator sponsored Phase 2 trial showed imetelstat activity in patients with advanced myelodysplastic neoplasms or acute myeloid leukemia who had failed or could not tolerate hypomethylating agent therapy (Key Developments)
• RYTELO, Geron’s telomerase inhibitor, is now the first and only drug of its class approved by both the U.S. Food and Drug Administration and the European Commission for certain lower risk MDS patients with transfusion dependent anemia (Key Developments)
• Clinical trial safety data reported high rates of serious hematologic adverse events, including new or worsening Grade 3 or 4 thrombocytopenia in 65 percent of RYTELO treated MDS patients and Grade 3 or 4 neutrophil abnormalities in 72 percent, which underscores a complex benefit risk profile (Key Developments)
• Geron continues a pivotal Phase 3 IMpactMF trial in JAK inhibitor relapsed or refractory myelofibrosis and other studies in myeloid malignancies, while cautioning about regulatory, manufacturing, commercial execution, and post marketing commitment risks that could affect timelines and approvals (Key Developments)

Valuation Changes

• Fair Value Estimate, reduced from approximately 6.0 dollars to 5.0 dollars, representing a moderate downward revision in long term valuation.
• Discount Rate, increased slightly from about 6.9 percent to 7.3 percent, reflecting a modestly higher perceived risk profile.
• Revenue Growth, lowered significantly from roughly 65.9 percent to 46.3 percent, indicating more conservative expectations for future top line expansion.
• Net Profit Margin, reduced meaningfully from about 50.5 percent to 34.1 percent, suggesting less aggressive assumptions on long term profitability.
• Future P/E, raised from around 14.5 times to 20.3 times, implying investors may need to pay a higher multiple for projected earnings despite the lower growth and margin outlook.