FDA clearance of the IND for MCY-M11 is a watershed moment. It is MaxCyte’s first next-generation CAR (chimeric antigen receptor) candidate to approach the clinic, and significantly will be studied in solid tumours. Regulatory clearance of the Phase I trial means first patient dosing – and detail on trial design - is on track for H218. Clearance, while expected, provides important validation of the proprietary mRNAbased CARMA platform, and MaxCyte’s scientific and regulatory expertise in the fastevolving cell therapy field. The H118 trading statement confirms solid progress in both growing and advancing the number of cell therapy licenses, underpinning Board confidence that FY18 revenue will meet market expectations. We maintain our £166m or 327p/share valuation, pending interims and updated financial guidance.
FDA grant of the MCY-M11 IND (investigational new drug) application, filed in November 2017, is a major milestone. A Phase I study in advanced peritoneal cancers (relapsed/refractory ovarian cancer, peritoneal mesothelioma) will begin dosing in H218. MCY-M11 is MaxCyte’s first next-generation CAR therapy; it has been engineered to minimise issues of ontarget/off-tumour toxicity seen with viral CAR approaches, and applicability to solid tumours. Promising clinical data should stimulate interest in the CARMA platform.
The number of cell therapy projects licensing MaxCyte’s technology continues to rise (now >55 from >50 at end-FY17) and encompasses broad applications (including gene editing, immuno-oncology and regenerative medicine). Growth in licenses covering clinical stage programmes (>25 up from >15 at H117) bodes well for driving future value. As partners progress into the clinic, the technology becomes more deeply embedded, increasing instrument and consumable use, and the likelihood of needing a commercial license. Ongoing investment in sales and marketing should improve scalability to support growth.
H118 revenues were $6.9m; +11.6% on H117, and up 14.7% excluding commercial license upfront fees. Performance over the period coupled with ordinary seasonality means MaxCyte continues to trade in line with market expectations.
We maintain our £166m or 327p/share valuation of MaxCyte ahead of disclosure of MCY-M11 trial details and updated financial guidance, potentially at H118 results in late-September. However, this is not to understate the significance of the achievement, albeit expected, of the first FDA clearance for MaxCyte. At this stage we make no material changes to our estimates, although we have made a modest reduction to FY18 CARMA spend and transferred some forecast spending from R&D to sales and marketing investment.
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