H.C. Wainwright downgrades RAPT shares to neutral after clinical trial halt

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H.C. Wainwright downgrades RAPT shares to neutral after clinical trial halt
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On Wednesday, RAPT Therapeutics (NASDAQ: RAPT ) faced a downgrade from H.C. Wainwright, moving from Buy to Neutral, following a pause in all clinical trials for its drug zelnecirnon. The action was taken after the U.S. Food and Drug Administration (FDA) placed a clinical hold on the trials due to a patient death potentially linked to liver failure.

The FDA's notification, which RAPT Therapeutics received last Friday, pertains to a Phase 2b trial for atopic dermatitis (AD) where the liver failure issue was observed. This incident was singled out as potentially related to zelnecirnon, despite liver toxicity not being detected in any of the other approximately 350 patients treated with the drug thus far.

The firm indicated that the company is awaiting further instructions from the FDA on steps required to resume the trials. Additionally, RAPT Therapeutics must assess the impact of the hold on the Phase 2b trial and determine whether the trial can continue or if a significant delay in clinical development is inevitable.

Given the uncertainty surrounding the clinical development and potential delays beyond a year if the trial cannot proceed, H.C. Wainwright has removed its price target for RAPT Therapeutics and downgraded the stock to Neutral. The market and investors are now looking for more information from both the FDA and RAPT regarding the future of zelnecirnon's clinical trials.

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