Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on Celyad. We currently have 18 research reports from 2 professional analysts.
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.
The Japanese pharmaceutical company ONO is jumping a therapeutic generation by licensing Celyad’s allogeneic preclinical NKR-T cancer cell therapy for Japan, Korea and Taiwan. Allogeneic NKR-T has the same action as the Phase I/II NKR-T autologous product; allogeneic versions could be mass produced and provided “off the shelf”. ONO paid €11.25m cash with €270.75m possible in milestones plus royalties. NKR-T is being tested in two haematological cancers with trials in solid tumours planned for early 2017. On an interim basis, until more data on NKR-T and C-Cure are available, the indicative value moves from €32 to €41 per share.
And then worst of all, you never get approval when you say you will. There is nothing that causes investor whiplash more than a sudden announcement of an unsuccessful clinical trial. Whether you are the onedrug wonder on AIM or the multi-drug portfolio NASDAQ darling, the market never takes too kindly to unsavoury news from the FDA on clinical results. But should investors lambast these two scenarios similarly based on poor trial results? The variables are endless but in this example the clear answer is no. Investors who invest in one-drug companies edging ever closer to FDA decision day do not have much cause for complaint as they are rolling the dice. But what of the company with many drug candidates in the clinic? Surely the usual knee-jerk reaction of a mass selloff is not rational when a company has a singular failure amongst a well-developed and advanced portfolio?
Companies: AZN BTG CYAD CIR ETX GSK GTCL GWP INDV SHP VER VRP
Celyad’s Phase III CHART-1 study in cardiac regeneration missed its primary endpoint, but a clinically defined subgroup with 60% of patients saw a positive outcome, p=0.015. Celyad management believes data are robust enough to discuss submitting a conditional marketing authorization to the EMA for European approval. Data on the CHART-1 composite endpoint will be presented on 28 August 2016. The US Chart-2 trial with a new endpoint and EDV focus will run if partnered. On the basis of limited data, the indicative value has been revised from $96.8 to $35.2 per share.
Celyad’s Phase III CHART-1 study in cardiac regeneration missed its primary endpoint, but a clinically defined subgroup with 60% of patients saw a positive outcome, p=0.015. Celyad management believes data are robust enough to discuss submitting a conditional marketing authorisation to the EMA for European approval. Data on the CHART-1 composite endpoint will be presented on 28 August 2016. The US Chart-2 trial with a new endpoint and EDV focus will run if partnered. On the basis of limited data, the indicative value has been revised from €88 to €32 per share.
Celyad can now move to the highest planned dose of 3x107 cells in the important NKR-2 Phase II CAR trial. If the next 30m cell dose is also safe (and the MTD) it will lead to two separate six patient open label studies in Acute Myeloid Leukemia and Multiple Myeloma. Further data is possible in late June. Efficacy indications in either of these could enable a series of solid tumor exploratory studies. The advantage of the NKR-T immuno-oncology approach is that it is easily transferred to multiple cancer types. FY15 accounts were as expected with year-end cash of $122m.
Celyad can now move to the highest planned dose of 3x107 cells in the important NKR-2 Phase II CAR trial. If the next 30m cell dose is also safe (and the MTD) it will lead to two separate six patient open label studies in Acute Myeloid Leukaemia and Multiple Myeloma. Further data is possible in late June. Efficacy indications in either of these could enable a series of solid tumour exploratory studies. The advantage of the NKR-T immuno-oncology approach is that it is easily transferred to multiple cancer types. FY15 accounts were as expected with year-end cash of €108m.
Research Tree provides access to ongoing research coverage, media content and regulatory news on Celyad. We currently have 18 research reports from 2 professional analysts.
EKF has reported a strong set of figures, slightly ahead of expectations. Revenues increased 8% to £41.6m and the margin profile of the business has been transformed, with gross margins significantly improved and EBITDA +52% to £9.3m. With the recovery phase now complete, attention is turning to driving the next leg of growth. We see a number of short and medium term growth opportunities over and above our published forecasts although, as ever, precise timing and quantum is uncertain.
Companies: EKF Diagnostics Holding
Perfomatrix PLC, a global end to end Performance Marketing technology and services company headquartered in the UK, is looking to join AIM in early April 2018, offer TBC Crusader Resources, an ASX-listed public company incorporated in Australia, which is primarily focused on the exploration and development of gold assets in Brazil. Offer TBC, expected late March. SimplyBiz, a Financial Services Firm, reported to be considering an IPO targeting a market capitalisation of between £140m and £155m in a listing that would raise £30m of new money. Bacanora Lithium—Readmission. No new money. Mkt cap £140m. Due 21 March. the new holding company for Bacanora Minerals Ltd Core Industrial REIT—established to invest in Irish-based industrial properties, predominantly located in the Greater Dublin Area. Vendor placing and new funds to a total of €225m, Target gross proceeds €207m. Expected Mid March Polarean - Medical drug-device combination company operating in the high resolution medical imaging market. Offer TBC. Due26 March
Companies: VLS SGZ SPA MTPH TLY ITQ TFW SAR RHL
In the March 2018 edition of the Hardman Monthly Newsletter, Nigel Hawkins addresses the attractions of quoted infrastructure funds that maintain a low profile.
Companies: OPM ABZA AVO AGY APH ARBB AVCT BNO BUR CMH CLIG COS DNL EVG GTLY GDR INL MCL MUR NSF OBT OXB PPH NIPT PHP RE/ REDX SCLP SCE SIXH TRX TON VAL
Pharmaceutical Services is a vast and varied landscape, reflecting the complexities in the discovery, development, manufacturing and monitoring of drugs and devices, all within a stringent regulatory environment. The overall growth prospects are highly favourable: drug development activity globally is on the up, led by smaller companies, which is driving demand for outsourced services. In this report we provide a breakdown of the sector into its main activity segments, and identify biologics, increasing service specialisation and consolidation as important value drivers. Finally, we present 15 companies (9 of which are publicly listed) that, in our view, are well placed to benefit from the sector’s secular growth trends.
Companies: ABZA BQE CSRT OXB INS UDG CLIN ABZA HZD ERGO
OptiBiotix Health Plc (LON:OPTI) focuses on managing and treating widespread, chronic medical conditions, such as obesity and high cholesterol, through the modulation of the human microbiome.
Companies: Optibiotix Health
Core biodecontamination revenues increased by 13%, driving a material improvement on operating margins to 10% and strong EPS growth of 78%. Having upgraded our FY18/19 EPS forecasts by 18% & 16% respectively in January, we make no further changes at this early stage in the year. The shares continue to trade at a material discount to peers and we see further upside scope on growth, forecast upside and potential cash returns.
What with North Korean missiles whistling over Japan, supreme leader Kim Jong Un threatening nuclear war against America and numerous other terrorist attacks, the world is undoubtedly a dangerous place. Demonstrated again just a fortnight ago, after a ‘lone wolf’ ISIS extremist, managed to explode a home-made ‘pipe-bomb’ in a busy New York underpass near Times Square.
Companies: Kromek Group
Oxford BioMedica’s full year results highlight the continued step up in bioprocessing and commercial development income, increasing 36% in the year, as the facilities operate close to capacity. The group announced on Friday that it had raised £20.5m to fund the expansion of its bioprocessing facilities as it continues to focus on establishing additional deals with its LentiVector® platform (as evident by the most recent deal with Bioverativ). The group’s partnered product pipeline continues to progress and we look forward to the additional expected approvals of Kymriah® later in the year.
Companies: Oxford Biomedica
In our second edition of “Trend spotting” we note how in the last three weeks the defensive rotation trend has gathered pace and further evidence has emerged of the “relative fading” in the UK economy. However we now see early signs of the “risk on” trend starting to reassert itself in equity markets and we look at small cap laggards plus European exposure as ways to play this.
Companies: GNS NTG SPH TRI XAR BOY VCT GHH CHH DPH INS HILS RPS LWB EKF UDG SYNT MYSL IMO BCA JUP KMK
Full-year adjusted EPS was 7% above our expectations, driven by higher revenues, gross margins and a lower tax charge. FY 2018 is a year of transition; the need to replace revenues from the loss of its second-largest licence income stream (c.£1.0m) with existing product growth and the introduction of troponin by Siemens. We reintroduce a target price of 2,600p implying 2018 P/E of 30x falling to 26x for 2019. Despite an 11% decline in EPS in FY 2018 as it transitions the licence loss, the shares should be underpinned by free cash flow (+11%), which supports a 3.5% yield, 3.4% free cash flow yield, 46% free cash flow/capital employed and 56% ROCE. Bioventix remains a top quartile investment in the finnCap Slide Rule.
2018 is the year of the Great Exhibition of the North. This summer, Newcastle and Gateshead will play host to a government-sponsored, 80-day marathon of events. Billed as the largest event in England this year, the Great Exhibition will showcase the best of the North East’s art, culture, design and innovation and we expect it to highlight the region’s ongoing success in high-end engineering, technology and life sciences. It may also reflect on the success of the North East’s plcs, the most striking example of which is Sage’s transition from 1980’s start-up to £9bn FTSE100 stalwart. We remain on the look out for the next Sage and expect the region to continue to produce attractive IPO candidates following Ramsdens’ success last year. Overall 2017 was a positive year for the region’s listed companies, one highlight of which was the takeover of Quantum Pharma, an N+1 Singer client, by Clinigen for £150m. We are confident that 2018 will be another successful year. Our top regional picks this year are Hargreaves Services, Zytronic and Applied Graphene Materials.
Companies: AGM BWY GRI GRG HSP IDH KMK NTG RFX UTW VNET ZYT
Allergy Therapeutics reported six-month results to 31 December that were affected by an abnormally weak allergy season in Central Europe that was highlighted in the 1 February trading update. Indications from the company are for the 2018 pollen season to return to normal levels. More relevant perhaps was the 12% increase in pre-R&D adjusted EBIT, which illustrates the underlying sales force advantage that the company is enjoying. With two key trial readouts in the second half (Phase IIb dose ranging study for PQ Grass and Phase III for PQ Birch), we remain optimistic that they will generate significant value inflection points for the stock. We maintain a target price of 47p, which implies a CY-adjusted 2018 EV/Sales of 3.7x (in line with peer group). Further upside (33p on a risk-adjusted DCF basis) exists for the Pollinex Quattro (PQ) Grass programme in the US.
Companies: Allergy Therapeutics
Realm Therapeutics (RLM) reports that top line results from its Phase II study of PR013 in Allergic Conjunctivitis (AC) failed to show efficacy and that consequently it has decided to cease further development of the topical (HOCl) hypochlorous acid-based ocular solution for AC application. The Company is continuing to prioritise the ongoing development of its most advanced dermatology programs in Atopic Dermatitis (AD) and Acne Vulgaris. There are distinct inflammatory mechanisms at play in AC as compared to in the dermatology indications. Lead product PR022 in AD is currently in Phase II studies, while RLM plans to file an Investigational New Drug application (IND) for a new program RLM023, in Acne Vulgaris in early Q418.
Companies: Realm Therapeutics
A fully integrated specialty pharma company, Midatech Pharma is rapidly progressing the development of three lead R&D programs. They have developed three proprietary drug delivery technologies (Q-Sphera, Gold Nano Particle and Nano Inclusion) to improve and expand the therapeutic potential of validated drug products. At the same time Midatech has built a US commercial unit focused on supportive care products.
Companies: Midatech Pharma
The past year has been a turbulent one for Hikma. A shortage-fuelled growth spurt and a resulting guidance upgrade had heralded the Jordanian company’s entry into the FTSE 100 in March 2015 (following the c.25% rally since the beginning of the year), making it only the fourth pharma constituent to become a component of this ‘blue-chip’ index. Fast forward a year, however, and multiple downgrades later, investor enthusiasm towards the company had waned, resulting in the stock being kicked out of the index in March 2016. However, the relegation proved short-lived, with the recent uptick in performance (Q4 15 and Q1 16 were slightly ahead of the otherwise ‘conservative’ market expectations), a string of recent drug approvals (13 to date in 2016) as well as improving sentiment towards the benefits of the Roxane acquisition (in the wake of the sharp sell-off post the downward revision to Roxane’s FY 16 and 17 guidance) triggering the company’s re-entry into the index in June 2016, after only a short three-month absence. Operationally, after a discouraging FY 15 (revenue down 3%, up 2% organically vs. 9% in FY 14) the last quarter has seen a gradual recovery in the company’s core businesses. The Injectables segment, following a flat FY 15 (as expected due to a tough comp base, >30% growth in FY 14, 3% cc growth) is back on the upswing, supported further by steady approval and relaunch of Bedford products. Management has guided for mid-to-high single digit revenue growth in FY 16, with the operating margin at a healthy c.36%. The MENA focussed Branded business is expected to be H2 16 weighted with low-double-digit topline growth in cc (13% cc growth in FY 15) but is likely to face increased forex headwinds (higher than earlier estimated) as well as an oil-price-triggered slowdown, courtesy of its Gulf exposure. Generics continued to register a yoy decline (>30%) on lack of shortage-driven opportunities but is expected to benefit from the Roxane acquisition (FY 16 segment revenue guided to be $640-670m, low double-digit operating margin). Resolution of the Colchicine patent infringement case by Takeda (with the court ruling in favour of Hikma) should further embellish growth potential for the segment. Management has maintained its full year guidance of revenue in the range of $2.0-2.1bn (including a ten-month contribution from the acquisition of Roxane Labs).
Companies: Hikma Pharmaceuticals