Updating for Ouro and Gamgertamig; Resuming Coverage at Equal-weight

Research evidence excerpt

Updating for Ouro and Gamgertamig; Resuming Coverage at Equal-weight

by Terence Flynn) have acquired the rights to gamgertamig, a potential best-in-class Q2 (1.51) - - - -

BCMA-directed T cell engager with lower affinity for CD3, which may support a Q3 0.12 - - - -

Q4 8.87 - (0.89) - -

more favorable safety profile (e.g., lower CRS risk) in autoimmune conditions. LKFT/ e = Morgan Stanley Research estimates

GILD are prioritizing development in rare autoimmune indications that offer the

potential for a capital-efficient unlock of blockbuster opportunities. Because of

LKFT's relevant collaboration economics, gamgertamig contributes modestly to our

DCF currently, but data readouts and development updates in the coming quarters

could move its contribution higher. LKFT's significant level of remaining cash/

investments (>€2B) on the balance sheet underscore reasonable likelihood that

business development updates - in the context of the Option, License and

Collaboration Agreement or OLCA with GILD - will remain a significant focus for

investors near-term.

A potential multi-blockbuster asset, but model impact is muted for now. We see

a potential blockbuster opportunity for a safer BCMA T cell engager like

gamgertamig in autoimmune indications; however, clinical data for gamgertamig is

relatively limited, and LKFT's broader collaboration with GILD may limit economics

to LKFT. Gamgertamig may have potential in >20 autoimmune indications where B Morgan Stanley does and seeks to do business with

cells/plasma cells are implicated. The initial indications prioritized for registrational companies covered in Morgan Stanley Research. As a result,

investors should be aware that the firm may have a conflict of