Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on Celyad. We currently have 24 research reports from 2 professional analysts.
Data at ASH on 3 December confirmed that CYAD-01 T-cells can destroy acute myeloid leukaemia (AML) blast (cancer) cells. In eight reported AML patients, there was a 62% (5/8) response rate across three dose levels. As preconditioning was not used, this rate is impressive. Safety was excellent with only one dose-limiting toxicity event at a high dose. The good safety profile should now enable faster progress to determine the optimal dose schedule. Further data are promised in H119, probably mid-year. A study combining CYAD-01 with preconditioning is underway and may be crucial. The indicative value is still €1,090m (€89 per share) pending further data.
The allogeneic version of NRK CAR T-cell therapy, CYAD-101, is underway with the first patient dosed. The study mirrors the current colorectal SHRINK trial in combining NKR CAR cell therapy with FOLFOX chemotherapy. This gives Celyad the lead in a potential high-value mass-market solid cancer where allogeneic therapy is likely to be essential. The indicative value is €1,090m (€89 per share) pending further data.
Celyad has presented an update on its CYAD-01 solid cancer trials with haematological data due in early December. There are strong indications that optimal effects can be gained by use of high doses, possibly with Cy-Flu preconditioning, or by combining CYAD-01 with chemotherapy in solid cancer. An allogenic colorectal trial will start in early 2019; an allogeneic product (CYAD-101) could have a major market in multiple cancer types. Our indicative value remains at €1,090m (€89/share) pending more data.
The FDA’s sign off on Celyad’s first clinical trial design for its allogeneic NRK CAR T-cell therapy (CYAD-101) is an important milestone. The study, possibly staring in Q4 2018, mirrors the current colorectal SHRINK trial a combination of autologous CYAD-01 therapy with FOLFOX chemotherapy. This gives Celyad the lead in a mass-market solid cancer where allogeneic therapy is likely to be essential. The indicative value has been increased to €1,090m (€89 per share) from €1,040m (€84 per share) pending further data.
Celyad has reached the potentially crucial three billion natural killer receptor (NKR) CAR T-cell dose (CYAD-01) in acute myeloid leukaemia (AML) with the first patient showing no signs of toxicity. If responses are seen in several patients, an expansion phase could start; a strong response was seen in November at the 300 million cell dose. Interim data are promised by Celyad in late 2018, probably at ASH. There are now several studies running or starting including using two courses of CYAD-01 in AML (after an initial response), evaluation of conditioning therapy with AML and combinations of CYAD-01 with chemotherapy in colorectal cancer. The indicative value remains at €1,040m, €84 per share.
The placing has given Celyad a cash boost of €46.1m gross adding to the €34m on 31 December 2017. Celyad is designing a set of sophisticated clinical trials to expand understanding of its novel NKR CAR T-cell therapy. The THINK study, focused on AML and colorectal cancers, showed a near complete response (CR) in AML in Q417 plus two other AML responses and two colorectal stable disease cases. The highest THINK dose range should complete in H218. The SHRINK study, NKR CAR T-cells plus chemotherapy in metastatic colorectal cancer (mCRC), has dosed its first patient. The indicative value has been adjusted to €1040m, €85 per share.
Celyad has reported a complete morphological leukemia-free status (MFLS) response in acute myeloid leukemia (AML) in the NKR CAR T-cell THINK study. Spontaneous remission in refractory/relapsed AML is extremely rare, so this is a significant result. Importantly, the response was achieved with no toxic preconditioning. CYAD-01 has shown limited toxicities to date. The clinical strategy has been updated to focus on AML and colorectal cancer. Additionally, with the approvals of Yescarta (Gilead) at a price of $373k and Kymirah (Novartis) at $475k, we have increased our expected price for NRK CAR T-cell therapy to $200k, formerly $150k. The revised strategy and price assumption change moves the indicative value to $122 per ADR, formerly $61 per ADR.
Celyad has reported a complete morphological leukaemia-free status (MFLS) response in acute myeloid leukaemia (AML) in the NKR CAR T-cell THINK study. Given that spontaneous remission in refractory/relapsed AML is extremely rare, this is an important result for natural killer CAR T-cell therapy. Importantly, the complete remission was achieved with no toxic preconditioning. CYAD-01 has shown limited toxicities to date
The development of Celyad’s natural killer (NK) receptor-based CAR T-cell therapy (NKR-2/CYAD-01) has taken an important step with the initiation of the SHRINK trial, which moves NK CAR T-cell therapy towards the 90%+ of cancer patients who do not have CD19 or BCMA tumors. CYAD-01 is already being tested in THINK with five solid tumor types plus AML and MM. Promising THINK results have been reported at the lowest dose. Celyad has paid $25m in cash and shares to reduce the royalties payable on potential short-term deals and long-term sales. Our indicative value of Celyad has been revised to $616m or $61 per ADR.
The development of Celyad’s natural killer (NK) receptor-based CAR T-cell therapy (NKR-2/CYAD-01) has taken an important step with the initiation of the SHRINK trial, which moves NK CAR T-cell therapy towards the 90%+ of cancer patients who do not have CD19 or BCMA tumours. CYAD-01 is already being tested in THINK with five solid tumour types plus AML and MM. Promising THINK results have been reported at the lowest dose. Celyad has paid $25m in cash and shares to reduce the royalties payable on potential short-term deals and long-term sales. Our indicative value of Celyad has been revised to €524m or €51.6 per share.
Novartis has taken a non-exclusive licence to Celyad’s granted allogeneic US patent for $96m (an upfront fee, we assume $12m, and milestones) plus single-digit royalties. Novartis, a leading player in the haematological CAR T-cell cancer area, presumably aims to expand out of the limited autologous ALL indication where it has a filed BLA. The $96m deal sends a clear signal to other CAR T-cell companies to license quickly or risk being locked out of any allogeneic mass market until 2031. Celyad already has an allogeneic deal with ONO in Japan and Asia. Our indicative value has moved to €52.25 per share, formerly €45.
Celyad has provided an update on its trial plans and announced 2016 preliminary results. The THINK Phase Ib trial is a major expansion of CAR therapy with five solid tumours plus AML and MM being explored. The THINK dose escalation results are expected in Q417 with six-month efficacy results possible from H218. The colorectal, SHRINK trial starting in Q2 will explore combining NKR-2 therapy with chemotherapy. The Q3 LINK trial will explore direct delivery of NKR-2 cells to metastatic liver tumours. The move into solid tumours puts Celyad in a leading position. Our interim indicative value remains at €45 per share. Cash remains strong at €82.6m.
Celyad has enrolled the first patient the Phase Ib THINK study. The THINK Phase Ib trial is a major expansion of CAR therapy with five solid tumors plus AML and MM being explored. The first patient has colorectal cancer, a key move into solid tumors, and will be dosed at 3 x 108 autologous cells. In the previous Phase I study, one patient at the highest 3 x 107 dose showed unexpected signs of efficacy. The US allogenic CAR patent has been confirmed. Our interim indicative value remains at $50 per share.
Celyad has reported at the American Society of Haematology (ASH) conference that the last treated patient from the three patient 30m cell dose cohort had stable AML disease for 12 weeks after NRK-2 treatment. Laboratory tests also indicate that responses to therapy were seen. The single dose used is 100x lower than the expected NKR-2 effective dose assessed in animal studies. Some other patients at lower doses also showed prolonged survival with unanticipated responses to other treatments despite their aggressive disease. Overall safety was good and importantly no cases of cytokine release syndrome, neurotoxicity and autoimmunity were observed. The new THINK Phase Ib trial is a major expansion of CAR therapy with five solid tumours plus AML and MM being explored. Our interim indicative value remains at €45 per share.
Celyad has noted that the Phase I safety study on its NKR-2 CAR T-cell autologous therapy produced some “reports of clinical benefit”. The THINK Phase Ib trial has been approved in Belgium and awaits FDA clearance. This is a major expansion of CAR therapy with five solid tumours plus AML and MM being explored. As a result, we have raised the probability of success to 20% from 18.5%. There is a challenge to the granted 2009 US patent on allogeneic CAR T-cells. While the claim is being re-examined, the patent remains in force; other patents and patent applications provide protection. Edison’s interim indicative value has been rebased and increased to €45 per share, formerly €41 per share.
Research Tree provides access to ongoing research coverage, media content and regulatory news on Celyad. We currently have 24 research reports from 2 professional analysts.
In the investment world, before MiFID II, essentially every institution talked to every broker, and the whole, professional market could see every research note and the forecasts in detail. This was the ‘Age of Consensus’. Everyone had the same information (well, everyone except retail investors), and this transparency helped share price formation and liquidity
Companies: OPM AVO AJB AGY ARBB AVCT CMH CSH DNL GTLY GDR KOOV MCL OXB RE/ REDX STX SCE SIXH TRX TON VAL VTA W7L
EKF has continued its recent pattern of raising and beating estimates by delivering results slightly ahead of expectations, despite some revenue headwinds after the ending of a large Saudi tender in FY17. Significant shareholder value was created during the year (EKF was an N+1 Singer Best Idea for 2018), delivering a total return of 27% including the 5.5p/share in specie distribution of shares in Renalytix AI, which IPO’d on AIM in November. The outlook remains positive, supported by new product launches (particularly DiaSpect Tm in the US) and we make no material changes to estimates at this stage. The shares continue to look good value, standing on an FY19 EV/EBITDA of 11x and a FCF yield of 5%+.
Companies: EKF Diagnostics Holding
We are introducing our Best Ideas for 2019 and also review the performance of last year’s picks. We suggest ten solidly financed stocks with good business dynamics that ought to be considered for core portfolio holdings and six UK domestically focused stocks that our analysts believe should perform strongly in the event that uncertainties unwind. We also introduce a new style of research from N+1 Singer which presents a Company’s dynamics and metrics in a clear and concise manner and concentrates on the pivotal issues affecting that Company and an investment decision.
Companies: BCA CLIN CLG CBP DNLM EAH FDL FCRM FUTR GTLY INS GLE NICL SDL SPR TRI
The market has not faced quite so many conflicting challenges for a number of years, whether related to global geopolitics, trade wars, ongoing Eurozone issues or the “will they, won’t they” saga of Brexit. In our Best Ideas, we sought to highlight stocks that present investors with interesting opportunities following recent market moves. Those stocks, we believe, warrant investor attention, in many cases for uncorrelated or stockspecific reasons, regardless of the near-to-medium term market direction. These stocks, in general, represent attractive and well-managed businesses or assets, with share price catalysts and where valuations or recent stock performance provide investors with a good entry point.
Companies: 7DIG ABBY AMS ANX ARS ATYM AVON BLVN PIER CGS CAML CALL CSRT TIDE DTG DEMG ELM EMR FPO FST GTLY GENL GRI GEEC HDY HMI HAYD HEAD HILS HTG HUR IBPO IOG INDI JHD JOG KEYS KCT KGH LAM MACF MOD MKLW OXIG PCA PARK PMO RBW RMM REDD RSW RNO RKH RBGP ROR SUS SCPA SHG SOLG TWD TRAK TRI VNET VTC ZTF
Hikma’s H2 18 top-line missed our as well as the street’s expectations marginally. Revenue was up by 4.4% to $1.09bn, driven by the robust performance by the Generic segment (+14%). A decline in the Branded segment (-1%; FX headwinds played a major role), was compensated by a marginal increase in the Injectables (+1%). On the profitability front, the EBITDA margin was up by 5.6ppt to 27%, attributable to a reduction in COGS (47.8% of sales vs 50.3% in H2 17; due to the consolidation of the manufacturing facilities), S&M (6.9% of sales vs 10% in H2 17) and G&A (8.8% of sales vs 10.7% in H2 17), partially offset by an increase in R&D (7.7% of sales vs 5.6% in H2 17). All FY 18 sales numbers are at CER unless specified otherwise. Revenue was up by 8% to $2.07bn, driven by strong across the business segments – Injectables (+6%), Branded (+5%) and Generic (+13%). The core operating margin was up by 2.3ppt to 22.2%, benefiting from the closing down of the Eatontown plant and the integration of the Memphis distribution into the Columbus facility – largely pertaining to the generic business (core operating margin of 13.4% vs 3.6% in FY17), supported by a minor increase in the Branded margin (21.6% vs 21.3% in FY 17), partially offset by a marginal decline in the Injectables margin (40.3% vs 40.6% in FY 17). We expect the manufacturing efficiencies to help realise savings of $20-30m annually from 2019, implying a higher operating margin in the Generics business in the coming years (management targets mid-teens vs 13.4% in 2018). FX had a negative impact of 1ppt on sales. Geographically, the US (62% of total revenue) grew by 8% to $1.3bn, benefiting from the opioid drug-shortage and the strong uptake of new generic drugs, partially offset by a decline in the legacy injectables portfolio and the ongoing pricing pressure in the generic industry. MENA (32% of total revenue) was up by 4.1% to $656m, supported by the strong uptake of the Remsima (biosimilar) in the Injectables segment (+21%), and the solid performance of the Branded segment in Egypt, mitigated by a weak performance in Saudi Arabia and Algeria along with the FX headwinds of 4%. Europe and ROW (6% of total revenue) was up by 15% to $121m, driven by the recent launch of lyophilised products. Our concern was the weak guidance for FY19 — Injectables (revenue $850-900m; core operating margin of 35-38%), Generics (revenue $650-700m; core operating margin in mid-teens), and Branded (revenue growth in mid single-digit), implying group revenue in the range of $2.07-2.17bn.
Companies: Hikma Pharmaceuticals
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. The Pollinex Quattro (PQ) platform, an ultra-short-course subcutaneous allergy immunotherapy (AIT), continues to gain market share despite its availability in the EU on a ‘named-patient’ basis only. The aim of ongoing trials is to move the platform to full registration under the new regulatory framework. Positive outcomes in Phase III allergy trials are notoriously difficult to achieve because the primary endpoint is always subjective. Prudently, AGY included an objective secondary endpoint, which was highly significant, paving the way for regulatory discussion.
Companies: Allergy Therapeutics
Full-year adjusted EPS was 11% above our expectations, driven by higher revenues across the majority of its product range. A 55p special dividend was proposed, resulting in full-year dividend growth of 27% to 116p. Strong underlying revenue growth (c.28%), which excludes c.£0.8m of backdated royalties and the loss of a c.£1.0m royalty stream, bodes well for future growth. This was despite a weak start for troponin sales in Europe, which we expect to benefit from Siemens’ US launch in July. We have increased FY 2019 forecasts by 11% and introduced forecasts for FY 2020 that imply c.12% EPS growth. We reintroduce a target price of 3,440p, which implies a 3.2% FY 2019 free cash flow yield, underpinned by 51% free cash flow/capital employed and 64% ROCE.
Circassia Pharma (CIR.L) - specialty pharmaceutical company focused on respiratory disease transferring from the Main Market. No funds being raised. Due 4 Feb. Greenfields Petroleum (TSX-V:GNF) production focused company with operated assets in Azerbaijan seeking AIM dual listing including $60m private placement. Mkt cap $12.6m CAD. Expected late January 2019.
Companies: ORCP IOF FOX TEG XLM TAP FST SNG ARE SRB
This Investment Research Paper addresses the issue of renewable power generation in the UK and in mainland Europe, which – after the deep-seated financial crisis of 2008/09 and the ensuing recession – now has better prospects of achieving critical mass. It also considers investment perspectives.
Companies: OPM AVO AJB AGY ARBB AVCT DISH BUR CLIG CSH DNL DPP GTLY GDR HAYD KOOV MCL MUR NSF OXB PCA RE/ REDX STX SCE SIXH TRX TON VAL VTA W7L
Korian experienced a strong performance in 2018. The accelerating top-line growth was mainly driven by healthy organic growth and mostly helped by the increased contributions from M&A. The limited margin decline in France has been offset by the good improvement in Germany and synergies achieved from the recently added sites. Thanks to the accelerating external growth, the group has upgraded its 2019 guidance and mid-term outlook.
SDI is acquiring Thermal Exchange Ltd, a manufacturer and supplier of cooling and temperature control equipment for the industrial, medical and scientific markets. The company is paying c.£1.1m to acquire the company, which represents historic FY 2018 EV/Sales and EV/EBIT multiples of 0.8x and 5.3x, respectively. The acquisition is being funded from cash with net cash at year-end expected to be c.£0.7m. This transaction represents another example of the company building out a suite of complementary businesses that should offer cross-selling opportunities to drive organic growth. We expect the acquisition to be 2% accretive to adjusted EPS in FY 2019 (neutral to statutory EPS, given c.£60k of acquisition costs) and c.9% in FY 2020. We raise our target price by 9% to 48p to reflect the earnings accretion. Based on our 2020 forecasts, this would place SDI on EV/Sales of 2.2x, EV/EBITDA of 9.6x and adjusted P/E of 16.4x with a FCF yield of 4.6% in FY 2019 rising to 5.8% in FY 2020.
Companies: Scientific Digital Imaging
SDI announced the acquisition of Graticules, a manufacturer and supplier of standard and bespoke reticles and graticules for the microscopy, metrology, education, scientific and defence markets. The company paid c.£3.4m, which represents historic FY 2018 EV/Sales and EV/EBIT multiples of 1.8x and 5.1x, respectively. The acquisition was funded by the full drawdown of its £5m revolving credit facility as well as the placing of 7.276m shares at 34p, raising £2.5m. There may be a further £0.1m raised through an open offer on PrimaryBid. We expect the acquisition to be 1% accretive to adjusted EPS in FY 2019 and c.5% in FY 2020. We raise our target price by 6% to 51p, which implies a FY 2020 EV/EBITDA of 9.9x and adjusted P/E of 16.6x with a FCF yield of 5.6% in FY 2020.
Companies: Scientific Digital Imaging
We have seen a continuation of the rally evident so far this year. The factors are familiar with greater optimism regarding US-China trade talks. At home, the path to Brexit remains unclear as D-day looms. The possibility of a delay has increased. The company reporting season continues to highlight winners and losers with the majority of results in line. We have also seen an uptick in corporate M&A. Results set the morning agenda and Brexit votes the evening one. In Share News & Views we comment on AorTech International*, APC Technology*, DeepMatter*, Golden Ocean Group and P&O Ferries/DP World.
Companies: AOR APC BONH BMS CTG CRPR DMTR ESC EUSP FDM FA/ LSAI NKTN PCF SNX TCN VRE W7L
Chi-Med reported FY18 results that met or beat expectations. Group revenues were $214.1m, down from $241.2m as the two-invoice impacted how domestic China sales are reported, with the JV revenues growth of 13.4% to $491.5m (from $433.3m) being a better reflection of the Commercial Platform’s performance. R&D spend in the Innovation Platform was $142.2m, up from $88.0m, as more later-stage clinical studies are undertaken. This sees the Group’s attributable net loss rising to $74.8m, against $26.7m last year. Cash resources remained strong, with $420.3m available at December 2018, versus $479.6m in 2017.
Companies: Hutchison China Meditech
A strong second half has brought trading for the full year in line with expectations and leaves the business well set for 2019. An exciting pipeline of new products should supplement an already strong organic growth outlook and could lead to material upgrades in time. We continue to see a clear path for management to realise its ambition of building a £100m+ business over the next 3-5 years.
Companies: Surgical Innovations Group