8 Hot Penny Stocks To Invest In According to Hedge Funds

6. Mereo BioPharma Group (NASDAQ:MREO)

Share Price: $4.40

Year to Date Performance: 90.48%

Number of Hedge Fund Holders: 23

Mereo BioPharma Group (NASDAQ:MREO) is a biopharmaceutical company that develops therapeutics for rare diseases. It holds a portfolio of late-stage clinical product candidates. Its two rare disease product candidates include setrusumab (which treats osteogenesis imperfecta (OI)) and alvelestat (which primarily treats severe alpha-1 antitrypsin deficiency-associated lung disease).

Apart from rare disease programs, the company has two oncology product candidates in clinical development: Etigilimab and Navicixizumab. Etigilimab, an IgG1 monoclonal antibody, improves the activation and effectiveness of T-cell and NK-cell antitumor activity. Navicixizumab, a bispecific antibody, is being developed to treat late-line ovarian cancer and inhibits delta-like ligand 4 (DLL4) and vascular endothelial growth factor (VEGF).

Mereo BioPharma Group (NASDAQ:MREO), along with its partner Ultragenyx, announced positive 14-month results from the Phase 2 portion of the ongoing Phase 2/3 Orbit study (NCT05125809). These results showed that treatment with setrusumab continually brought the incidence of fractures in patients with OI down. The treatment results in a fracture rate reduction of 67%, highlighting the potential of setrusumab to bring about long-term, clinically significant benefits for people with this condition. It also brought about meaningful and ongoing improvements in lumbar spine bone mineral density (BMD) at month 12 without evidence of plateau.

The company continues to work through detailed regulatory submissions to ensure the AATD program is Phase 3-ready by the end of the year in the domain of alvelestat. This is running along with its ongoing discussions with multiple potential partners. Mereo BioPharma Group’s (NASDAQ:MREO) proceeds from the June financing position it to support the ongoing pre-commercial activities critical for a successful launch of setrusymad in Europe after its potential approval. Mereo (NASDAQ:MREO) ranks sixth on the list of the 8 hot penny stocks to invest in according to hedge funds.