4D Molecular initiated by Morgan Stanley at underweight

Morgan Stanley initiated coverage of 4D Molecular Therapeutics (NASDAQ:FDMT) with an underweight rating due to concerns that its gene therapy candidate 4D-150 may not be able to clear the high bar set for the drug class.

The investment bank said that while Phase 2 data has suggested the gene therapy has a potentially competitive therapeutic profile in treating wet age-related macular degeneration, or wet AMD, it sees a “high bar for the class to carve out material market share.”

It added that its projected sales for the product are below consensus, with peak adjusted sales of $800M for wet AMD and $400M for diabetic macular edema.

Morgan Stanley set a price target of $8 for the stock.