This biotech stock has a massive upside, Roth says

Roth Capital Partners analyst Adam Walsh says a third controlled celiac disease dataset supporting IL-15 blockade increases the potential value of Equillium’s (Equillium Stock Quote, Chart, News, Analysts, Financials NASDAQ:EQ) EQ302 program.

In an Oct. 8 update, Walsh reiterated his “Buy” rating and US$12.00 target on Equillium.

Walsh said Belgian-Dutch pharmaceutical company argenx reported positive topline Phase 2 results for FB102 in celiac disease, marking the third controlled dataset supporting IL-15 blockade in the indication and the first to move toward Phase 3.

Equillium’s EQ302 is an oral dual inhibitor of IL-15 and IL-21. Walsh said the program carries no value in his price target because it has no human data and no disclosed partner, but becomes more valuable with each controlled celiac result.

“EQ504 in UC remains the driver,” Walsh said.

The analyst’s target is based on EQ504 in ulcerative colitis, where Australian regulatory clearance has been received and Phase 1 data are expected in Q2 2027.

The argenx FB102 Phase 2 study enrolled 126 adults with confirmed celiac disease who were symptom-free on a strict gluten-free diet for at least 12 months. Patients received one of two intravenous FB102 dose levels or placebo and were challenged with eight weeks of oral gluten.

The study met its primary endpoint, change from baseline in villus height to crypt depth ratio at day 78, with a p-value of 0.0176. Walsh said other histology, composite and symptom measures were consistent, while safety matched prior studies.

Argenx plans to move FB102 into Phase 3, and the FDA has granted Fast Track designation in celiac disease.

Walsh said EQ302 is differentiated by IL-21 activity and oral delivery. FB102 is an intravenous infusion, while Teva’s TEV-53408 is a subcutaneous antibody. He said an oral peptide could be a more practical format for a chronic condition in otherwise well patients.

Equillium owns worldwide rights to EQ302 and moved the program into IND-enabling development in Q2 2026. Walsh expects it to be monetized through a partner rather than carried through the clinic internally.

The analyst noted that two competitor programs have now shown protection against gluten-induced intestinal damage in controlled studies, but neither blocks IL-21.

Royalty Pharma committed up to US$500-million in January 2026 to accelerate TEV-53408, while argenx acquired Forte Biosciences for US$2.2-billion after a Phase 1b result that has now been validated by Phase 2 data.

“In our view the target risk on EQ302 has fallen, leaving delivery and dual inhibition as the open questions,” Walsh said.

Management has indicated EQ302 could enter the clinic within 12 to 18 months.

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