Rallybio (NASDAQ: $RLYB) Skyrockets 82%+ on Thursday After Announcing Johnson & Johnson Partnership

Rallybio (NASDAQ: $RLYB) is a clinical-stage biotech firm working on life-changing therapies for patients with severe and rare diseases. Headquartered in Connecticut, the company’s portfolio includes innovative drug candidates targeting maternal-fetal health, complement dysregulation, hematology, and metabolic disorders.  

Led by an experienced team, Rallybio is driven by a resolute mission to address unmet medical needs. The company’s two clinical-stage programs, RLYB212 and RLYB116, exemplify its commitment to tackling rare and debilitating conditions. As Rallybio’s stock trades on the Nasdaq exchange under the RLYB ticker, the company continues to make strides in the rare disease treatment landscape. 

On April 10, 2024, Rallybio Corporation announced a collaboration with Johnson & Johnson Company to support the development of complementary therapeutic approaches to mitigate fetal and neonatal alloimmune thrombocytopenia (FNAIT). This partnership includes a substantial equity investment of $6.6 million from Johnson & Johnson.

Rallybio’s Novel Antibody Treatment 

Rallybio is developing RLYB212, a novel human monoclonal anti-HPA-1a antibody designed to prevent pregnant individuals from becoming alloimmunized. This intervention aims to eliminate the risk of FNAIT and its potential harm to fetuses and newborns. In the latter half of 2024, the company intends to commence a Phase 2 dose confirmation trial for RLYB212 in pregnant individuals at elevated risk of alloimmunization and FNAIT. 

Johnson & Johnson, on the other hand, is conducting a Phase 3 investigation into nipocalimab, a monoclonal antibody designed to target FcRn among pregnant individuals who have already developed alloimmunization. Due to the presence of alloantibodies in these individuals, which have the potential to trigger FNAIT, the administration of preventative treatment with RLYB212 would not be considered suitable. 

Rallybio’s ongoing natural history study aims to gather critical data on HPA-1a alloimmunization frequency across diverse populations. This study will guide future RLYB212 registration efforts. 

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CEO’s Vision for a Safer Future 

Stephen Uden, M.D., Rallybio’s Chief Executive Officer, expressed gratitude for the collaboration and highlighted its potential to transform the landscape of FNAIT treatment. “Our complementary approaches, if successful, would ensure that pregnant individuals at risk of developing FNAIT have a potential treatment option — regardless of their alloimmunization status,” said Dr. Uden. 

Under the collaboration, Johnson & Johnson will provide funding for Rallybio to raise awareness of its FNAIT clinical program in connection with its ongoing FNAIT natural history study. Rallybio is also entitled to receive up to $3.7 million in additional payments within the collaboration. 

Fourth Quarter 2023 Financial Results 

R&D expenses totaled $15.9 million in Q4 2023, up from $10.8 million in Q4 2022. This increase was primarily driven by higher costs for advancing projects RLYB212, RLYB116, and RLYB331 compared to the previous year.  

G&A expenses were $5.2 million in Q4 2023, down from $6.3 million in Q4 2022. This decrease was mainly due to reduced payroll and personnel-related costs, lower director and officer insurance premiums, and other general and administrative expenses compared to the prior year.  

The net loss for Q4 2023 was $20.2 million, or $0.50 net loss per share, compared to $16.2 million, or $0.46 net loss per common share, in Q4 2022. 

Financial Highlights for Fiscal Year 2023 

In 2023, R&D expenses rose to $53.5 million from $40.7 million in 2022 due to increased project advancement costs for RLYB212, RLYB116, and RLYB331, as well as higher R&D-related headcount expenses. However, reduced R&D asset acquisition costs and expenses related to RLYB114 partially offset this increase. 

G&A expenses decreased to $25.4 million in 2023 from $27.2 million in 2022, primarily due to lower personnel costs and reduced insurance premiums, although other administrative expenses increased. 

The net loss for 2023 was $74.6 million, with a net loss per share of $1.84, compared to $66.7 million, or a net loss per share of $2.09, in 2022. As of December 31, 2023, cash, cash equivalents, and marketable securities totaled $109.9 million. 

Ralloybio Announces Layoffs 

In February 2024, Rallybio announced a prioritization of its portfolio and a 45% workforce reduction to focus the company’s resources on its two Phase 2 ready assets, RLYB212 and RLYB116. As a result of these adjustments, Rallybio anticipates that its available cash reserves will sustain the company’s operations until at least the middle of 2026. 

The workforce reduction involves cutting 19 positions, which are slated for completion by the end of the first quarter of fiscal 2024. Rallybio projects that this reduction will incur total charges of approximately $3.3 million, primarily for severance and benefits expenses, excluding share-based compensation. 

Rallybio Corporation Stock Performance  

RLYB shares witnessed a surge in momentum after announcing its collaboration with Johnson & Johnson. At the close of trading on Thursday, April 11, the stock was up 82.82% at $2.98.

Over the past month, RLYB has risen 77.38%, while year-to-date, the stock is up 24.17%. However, it is down 34.07% over the past 52-weeks compared to the 24.47% gain of the SPX.   

The company’s 52-week range is a high of  $9.14 and a low of $1.23, with an average volume of 258.35k shares traded over the past ten days. There are 37.81M shares outstanding and a market capitalization of $112.68M. 

Analysts Predict Strong Growth for Rallybio 

According to recent assessments by Wall Street analysts, Rallybio’s projected 12-month price targets range from a high of $20 to a low of $1.50 The consensus among these analysts suggests a positive outlook for the company, with an average price target of $10.30. This estimate indicates a significant upside potential of 246.80% from its last closing price, with an overall strong buy rating. 

Is RLYB a Worthwhile Investment? 

Rallybio’s partnership with Johnson & Johnson marks a significant step in providing an easy pathway for getting its product to market. It also provides an important source of funding when the company has had to make workforce cuts. 

The recent stock performance reflects investor confidence in its collaborative efforts and future growth potential. Analysts project strong growth for the company, with optimistic price targets signaling positive market sentiment. Overall, Rallybio’s partnership with Johnson & Johnson could be the perfect catalyst for success. 

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