Celsion Corp. (NASDAQ: CLSN) watched its shares make an incredible gain on Tuesday after it received an even bigger upgrade from Oppenheimer. This came on the heels of new findings in its Liver Tumours study.

Oppenheimer initiated Celsion with an Outperform rating and a $9 price target, implying an upside of 320% from Monday’s closing price of $2.14.

The brokerage firm pointed out that Celsion had a well-known Phase 3 failure (HEAT study) in 2013. Subsequent criticism of the failure and the company’s post-hoc analyses of various subsets have contributed to much skepticism around lead program ThermoDox for liver cancer.

Celsion’s continuation of the study (to 2016), thorough analysis of one of the largest studies ever run in liver cancer, leads Oppenheimer to posit that CLSN has an increased chance of success for its second ongoing Phase 3 OPTIMA. With another compelling (early stage) asset in GEN-1, the firm advises investors to heed a much-maligned story.

The HEAT study results were recently published in AACR’s Clinical Cancer Research and it is clear that the experimental arm did not outperform the control arm. However, subsequent post-hoc analyses noted that patients with an RFA dwell time of >45 minutes had an overall survival (OS) benefit.

Other analyses also indicated that the variability in the RFA dwell time in the trial might have contributed to its poor results. Lastly, an NIH post-hoc analysis of HEAT data published in November 2016 indicated that burn time and tumor volume could increase survival significantly.

Oppenheimer said in its report:

We remind investors that an important purpose of clinical trials is to generate hypotheses. We believe that the analysis and learnings from HEAT have led CLSN to design a robust OPTIMA (N=550) Phase 3 trial; scheduled to read out in 2019. If this trial is successful, we see ThermoDox as a $300-500M revenue opportunity.

Celsion has taken the long (6-7 years between HEAT and OPTIMA results) and hard (fundraising activities and dilution that have hit the stock) road to potentially finally finding OPTIMA(L) redemption. We advise investors who are skeptical of the story to look beyond the company’s rocky history to the clinical data. We are bullish.

Shares of Celsion were last seen up nearly 50% at $3.16, with a consensus analyst price target of $8.00 and a 52-week range of $0.19 to $6.06

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