Investing.com - BTIG lowered its price target on Compass Pathways (NASDAQ: CMPS ) to $7.00 from $12.00 on Tuesday while maintaining a Buy rating, citing concerns about the company’s COMP360 drug development. For deeper insights into CMPS’s financial health and growth potential, InvestingPro subscribers gain access to detailed valuation metrics, peer comparisons, and expert analysis of biotech sector trends.

The research firm expressed worry that COMP360 represents "the very careful development of a mediocre drug relative to other options" in both psychedelic and non-psychedelic pipelines. BTIG noted the latest top-line announcement showed a MADRS reduction from the 25 mg to 1 mg dose of about 4 units, consistent with Phase 2 results.

The consistency between Phase 2b and Phase 3 trials was highlighted as impressive in the treatment-resistant depression (TRD) field, where clinical trials are typically challenging. BTIG referenced Lilly’s 2006 Symbyax trials, where one study showed significant benefits while another showed no treatment effects.

BTIG indicated the equivalence to SPRAVATO was expected based on prior data, suggesting the market for COMP360 would likely be patients who have already tried some form of ketamine. The firm anticipates this market positioning would persist for several years.

The analyst also noted recent compelling treatment effects from private company Gilgamesh’s trial, which raises the possibility that easier-to-use drugs with lighter or no psychedelic effects may prove as effective in treating depression as major hallucinogens like psilocybin and LSD.

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