MoonLake’s Make-or-Break Phase III Readout for SonelokimabMoonLake Immunotherapeutics Class ABATS:MLTXFreedomHoldingMoonLake’s Make-or-Break Phase III Readout for Sonelokimab in PsA Phase III trial results for sonelokimab in psoriatic arthritis (PsA) are expected to be released in Q3. Sonelokimab is MoonLake’s only drug candidate. Positive results could restore market confidence in the viability of the company’s platform. MoonLake Immunotherapeutics (MLTX) Biotechnology Ticker: #MLTX Price at the time of analysis: $18.94 Target price: $29.00 Stop-loss: $14.00 Key Investment Highlights Phase III results for sonelokimab in PsA are expected in Q3 2026. Sonelokimab is MoonLake’s sole clinical-stage asset. Positive results could provide important clinical validation and restore investor confidence in the program. Investment Thesis MoonLake Immunotherapeutics (MLTX) is a clinical-stage biotechnology company headquartered in Switzerland. Its lead asset is sonelokimab, a trispecific nanobody being developed for inflammatory skin and joint diseases for which current treatment options remain inadequate. Phase III data for sonelokimab in patients with PsA are expected in Q3 2026. This is an important near-term catalyst for MLTX shares. Positive Phase III results from the IZAR program would provide important clinical validation of sonelokimab’s potential in rheumatology. In the coming months, the company plans to report topline results from IZAR-1, a placebo-controlled Phase III study (NCT06641076) designed to evaluate the efficacy and safety of sonelokimab in patients with active PsA who have not previously received biologic therapy. The IZAR-1 protocol includes two sonelokimab cohorts. In the first cohort, patients will receive an induction regimen consisting of four doses administered every two weeks (Q2W), followed by maintenance treatment every four weeks (Q4W) beginning at Week 8. Patients in the second cohort will not undergo an induction phase. The primary endpoint of IZAR-1 is the ACR50 response rate at Week 16. ACR50 is a widely accepted and clinically validated measure of treatment efficacy in PsA. It measures the proportion of patients who achieve at least a 50% improvement according to the American College of Rheumatology response criteria. Results from the completed placebo-controlled Phase II ARGO study (NCT05640245) increase confidence in a positive outcome for the IZAR program. In ARGO, 46% of patients who received the 60 mg dose achieved an ACR50 response after 12 weeks of treatment. Sonelokimab belongs to a new class of biologics known as nanobodies, which are smaller than conventional antibodies. Sonelokimab’s mechanism of action involves simultaneously inhibiting three pro-inflammatory targets: interleukin-17A (IL-17A), interleukin-17F (IL-17F), and the IL-17A/F complex. Because the cytokines IL-17A and IL-17F are involved in a broad range of chronic inflammatory diseases, sonelokimab may have potential across multiple autoimmune indications. Potential indications include hidradenitis suppurativa (HS), PsA, and axial spondyloarthritis (axSpA). One of sonelokimab’s principal competitors is BIMZELX (bimekizumab), developed by UCB and directed at similar targets. BIMZELX was approved by the FDA to treat patients with active PsA in September 2024 based on results from the Phase III BE OPTIMAL study (NCT03895203). In that study, 44% of patients achieved an ACR50 response after 16 weeks of treatment. Given the similarities between the BE OPTIMAL and IZAR-1 study designs and the results of ARGO, our positive base case assumes an ACR50 response rate above 45% and a statistically significant improvement versus placebo. Because the placebo response rate is difficult to predict, the company has decided not to include placebo-adjusted treatment effects in the forthcoming topline data release. This will make indirect comparisons with BIMZELX more difficult until the full results are available. Because sonelokimab is MoonLake’s only active asset, we expect the upcoming clinical update to be a significant catalyst for MLTX shares. Positive results could drive the stock toward filling last year’s price gap and restore confidence in sonelokimab’s broader clinical and commercial potential. Conclusion: Based on our technical analysis, we assign MLTX a two-month price target of $29 and a Buy rating. We recommend placing a stop-loss at $14.