An experimental treatment for hair loss is being hailed on Wall Street. BTIG initiated research coverage on Abshi Corporation on Thursday with a buy rating and a 12-month price target of $9, saying the company’s AI-designed long-acting antibody ABS-201 could have peak sales of up to $2.2 billion. In its first-quarter earnings call earlier this month, Absi said the antibody could be the “first novel mechanism of action in male pattern baldness in nearly 30 years,” adding that it had also started an endometriosis clinical advisory committee for the ABS-201 program. “ABS-201 is a truly differentiated asset that straddles two large underserved markets,” and “could be a GLP-1 moment for hair removal,” BTIG analyst Kambiz Yazdi said in a 39-page report. GLP-1 treatments for diabetes and weight loss “were successful not just because they were effective, but because they met the needs of a large, underserved, and highly individualized consumer population in a convenient, infrequently injectable format,” BTIG said. The investment bank noted that about 80 million Americans suffer from hair loss, and the last time the Food and Drug Administration approved a new hair loss treatment was about 30 years ago. AI Platform Absci’s AI platform is a “real technological moat” and the clinical-stage biotech is building an “advanced end-to-end generative AI antibody platform,” BTIG said. “Each cycle of design and testing feeds into a unique data lake that compounds value for each program, creating a self-reinforcing moat that competitors cannot easily replicate.” ABS-201 works by blocking the prolactin receptor, a membrane-bound protein on the surface of cells in the breast, brain, and other organs. This causes the hair follicle to transition from regression to active growth. Preclinical data show that this process preserves the growing follicle and restores pigmentation, a hallmark of regrowth. ABS-201 is currently in Phase 1/2A trials for androgenetic alopecia, an advanced disease that affects 10% of women worldwide. BTIG expects the ABS-201 study in endometriosis to begin in the fourth quarter. According to BTIG, “Although the AI drug discovery field is conceptually crowded, Absci has held a defensible lead in the race to AI-designed medicines for several years due to its real-world traction, breadth of capabilities, and growing data/partner ecosystem.” Absi, based in Vancouver, Washington, launched its IPO in July 2021 at $16 per share.
