Here's A Last Minute Catalyst To Watch Ahead Of Kadmon Holdings Inc (NYSE:KDMN)'s R&D Day

Kadmon Holdings Inc (NYSE:KDMN) is a stock that we keep coming back to here at Insider Financial. Over the last 12 months, we have repeatedly argued that the company is undervalued at-market and that – as a result – could be a great allocation ahead of a potential reevaluation throughout the latter half of 2017 and beyond.Back on June 23, as part of our most recent coverage, we made the argument that the then-current pricing was a great opportunity to pick up exposure on a dip from highs. At the time, the company traded for $3.30 a share, down from $3.65 a share at its most recent swing high.At close on June 28, Kadmon went for $4 a share, a quick turnaround 22% gain for anyone that bought the dip we highlighted.What is important to recognize here, however, is that the recent appreciation, and the gap close from the above-mentioned dip, is just the start of a longer-term reevaluation for the stock. Markets are loading up on Kadmon ahead of a spate of key development related catalysts in anticipation of said catalysts hitting press as positive, and it is this added speculative volume that is driving the recent gains. If the catalysts come out as favorable, current prices will be in the rearview mirror and Kadmon should run towards double figures relatively easily.In this piece, we listed the catalysts that we are keeping an eye on, and that – in turn – markets are watching as potentially driving this stock going forward. Management just put out a fresh update, and it turns out that we missed a catalyst off the list. Not just any catalyst, a very near-term catalyst that could really jump start the stock into action.In the interest of complete coverage, then, here's what we missed.As per its latest release, management is going to provide markets with some interim data relating to its lead chronic graft-versus-host disease (cGVHD) asset, a drug called KD025, at a Research and Development Day scheduled to take place on July 11, 2017.For those not familiar with this asset, it underpins the majority of the company's development program right now and is spread across a number of indications, including idiopathic pulmonary fibrosis, psoriasis, and the above-mentioned cGVHD. It is what's called a ROCK inhibitor. ROCK, which stands for Rho-associated coiled-coil kinase 2, is a molecular target that is associated with a whole host of autoimmune conditions. Basically, it's an inflammatory modulator so, through the inhibition of ROCK, the company hopes that it can inhibit inflammation, and – in doing so – limit the impact of the spectrum of conditions caused by unchecked inflammation (three of which are the above-noted idiopathic pulmonary fibrosis, psoriasis and cGVHD).The data set to read out on July 11 is interim data from a phase 2 study, which is set up to compare the drug to placebo in the target population. If the data reads out as positive, the implications go far beyond this initial cGVHD study. Why? Because – as mentioned – this drug should theoretically be able to be applied to a large number of different inflammatory conditions and positive data in one (namely, cGVHD) will imply similar clinical success in others.As such, if the Research and Development Day data points to clinical benefit, markets are going to take that as indicative of success in the other two ongoing phase 2 trials, and beyond, in any expanded immune related indication.It's speculative to link the success of a mechanism of action in one target population with similar success in another, but we have seen it before, and we'll almost certainly see it here as and when the data hits.Of course, the data may disappoint, but we see it as unlikely that management would present disappointing data at an event like that set for July 11.We'll be watching closely to see how things play out and we'll update accordingly as and when the numbers hit press.Catch up on our previous coverage of this stock here.We will be updating our subscribers as soon as we know more. For the latest updates on KDMN, sign up below!Image courtesy of Ed Uthman via FlickrDisclosure: We have no position in KDMN and have not been compensated for this article.