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Allergy Therapeutics plc (AIM: AGY): H1 FY2026 trading updateCambridge Cognition plc (AIM: COG)*: FY2025 trading update
Allergy Therapeutics plc Cambridge Cognition Holdings Plc
Allergy Therapeutics (AGY) has provided a trading update for the 6-months to December 2025. 1H26 revenues are expected to be £36.3m (1H25: £34.0m) representing 7% growth on a reported basis, or c3% on a constant currency basis. In our view, this revenue growth is highly encouraging considering the backdrop of the ongoing transition away from unregistered products in Germany and reflects strong growth in the Group’s existing German registered product portfolio. Most notable during the period was the regulatory approval of Grass MATA MPL (to be marketed as Grassmuno) in Germany. The approval has paved the way for the rollout of Grassmuno in Europe’s largest allergen immunotherapy market, with the grass pollen segment projected to reach c$1bn by 2030, according to internal company estimates. Gross cash at the end of the period was £10.1m. The balance sheet was further deleveraged following the exercise of warrants held by the group’s shareholder lenders with aggregate gross proceeds of £55m used to pay down all outstanding financial indebtedness. We leave our FY26E forecasts unchanged for now.
Allergy Therapeutics plc
In what we believe marks one of the most major catalysts in recent years for the company, Allergy Therapeutics (AGY) has announced it has received marketing authorisation approval from the German regulators, the Paul Ehrlich Institut, for Grass MATA MPL (to be marketed as Grassmuno). The approval paves the way for the commercial launch of Grassmuno in Europe’s largest allergen immunotherapy market, with the grass pollen segment projected to reach c$1bn by 2030, according to internal company estimates. The approval also marks the first subcutaneous grass-pollen immunotherapy to be authorised by the German regulators under the TAV (Therapieallergene-Verordnung) programme, marking a first-mover competitive advantage for Grassmuno in the region. While Allergy Therapeutics has faced some challenging headwinds in recent periods, through manufacturing issues and an evolving regulatory landscape, we believe the news today marks a transformational event in the company’s history and should serve as a significant catalyst to the shares. Given management’s previous commentary around Grassmuno’s potential to achieve €100m peak sales in Germany alone, we believe that a successful commercial launch, planned for 1Q26, has the potential to steer the company towards self-sustaining profitability.
Allergy Therapeutics (AGY) has reported full-year results to end-June 2025, in line with the July 2025 trading update. Revenues of £55.0m were broadly flat YoY (FY24: £55.2m) on a reported basis, up c2% YoY at CER. The FY25 revenue figure reflects an observed shift in the group’s product mix, driven by German regulators accelerating the transition from non-registered to registered allergen immunotherapy products more quickly than previously anticipated. Post-period, the balance sheet was deleveraged through the exercise of warrants by the group’s shareholder lenders with the proceeds used to fully repay the outstanding £55.0m shareholder loan facility. With a new uncommitted shareholder loan facility of £50.0m now in place, the group has financial flexibility to see it past multiple upcoming value inflection points, the most significant of these, in our view, being a decision on the marketing authorisation application (MAA) for Grass MATA MPL in Germany, where we expect to hear an update in early 2026. However, as a result of the timing uncertainty around Grass MATA MPL’s launch as well as increased commercial and marketing investment in FY26E to support uptake we have revised our FY26 estimates and now expect FY26E revenues of £68.0m (prev. £77.0m) and an adj. EBITDA (pre-R&D) loss of £6.3m (prev. £9.6m profit).
Allergy Therapeutics (AGY) has provided a positive update from its Phase I/IIa clinical trial (PROTECT) investigating AGY’s short-course peanut allergy vaccine candidate, VLP Peanut. Healthy cohorts in the study have now completed dosing at the maximum intended levels, with no dose-limiting safety or tolerability signals observed, to date. With just one final cohort of peanut-allergic patients remaining, dosing is expected to extend beyond the candidate’s anticipated effective dose range, further underscoring VLP Peanut’s robust safety profile. The final stage of the trial is progressing as planned, with results expected to inform dose selection for the planned Phase IIb study, scheduled to begin in 2026. This latest trial update is further supported by previously reported (December 2024) interim biomarker efficacy data where VLP Peanut demonstrated a meaningful dose-dependent reduction in skin sensitivity to peanut allergen, with treated patients showing a 48% reduction in wheal size (the raised, swollen area on the skin that appears after exposure to an allergen) after skin-prick test compared to an 8% reduction in those treated with placebo. The peanut allergy market has the potential to grow into a multi-billion-dollar therapeutic segment, a view we believe is shared in the market given previous M&A activity in the space with Nestlé’s US$2.1bn acquisition (Aug. 2020) of Aimmune Therapeutics for the peanut immunotherapy product Palforzia.
Allergy Therapeutics (AGY) has provided a trading update for the 12 months to June 2025, with revenues of £55.0m broadly flat YoY (FY24: £55.2m) on a reported basis, up c2% at CER, and slightly below our FY25 estimates of £58.0m. The FY25 revenue figure reflects an observed shift in the group’s product mix, driven by German regulators accelerating the transition from non-registered to registered allergen immunotherapy products more quickly than previously anticipated, echoing commentary from AGY’s interims (Mar. 2025). Gross cash is expected to be £12.8m, supported by AGY’s Shareholder Loan and Hayfin Debt Facilities, from which the group drew down £15m and £20m during the year, respectively. The press release states that the group’s major shareholders “remain supportive of the business” and have committed to providing further funding from the existing shareholder loan facility in August 2025 to finance ongoing operations. We have adjusted our FY25E forecasts to align with the trading update but leave our FY26E numbers unchanged for now.
Allergy Therapeutics (AGY) has announced its 6-month interim results to end-December 2024, reporting 1H25 group revenues of £34.0m (1H24: £33.6m), in line with the January trading update. Although 1H25 revenue growth of 1% (4% at CER) may appear modest, it marks the second consecutive half-year of growth – an encouraging signal, in our view, that AGY’s prolonged (three-year) period of revenue decline is beginning to stabilise and reverse. While we continue to expect a recovery in revenue, we have revised our FY25E forecast to £58.0m (previously £64.8m), reflecting a faster-than-anticipated transition to registered allergen immunotherapy products. We have also applied more cautious growth expectations in FY26, the period in which we anticipate the launch of Grass MATA MPL, and now estimate FY26E revenues of £77.0m (prev. £80.9m). We maintain our target price of 13p, underpinned by our DCF, which is primarily driven by our longer-term revenue expectations around GRASS MATA MPL and clinical progression of the VLP Peanut programme.
Allergy Therapeutics (AGY) has provided a trading update for the six months to December 2024, noting that the financial turnaround of the business continues to progress as 1H25 marks the second consecutive half-year period of expected revenue growth. Revenue in 1H FY25 is expected to be £34.0m (1H24: £33.6m) representing 1% growth on a reported basis, or more than 4% on a constant currency basis. Additionally, the volume of units sold increased by 5% indicating a recovery in manufactory output, with the growth primarily driven by a rebuild of AGY’s diagnostic portfolio. Gross cash at the end of the period was £21.7m, having been boosted by the receipt of a £20m committed five-year term loan from Hayfin Healthcare Opportunities Fund. We maintain our FY25E forecasts, anticipating stronger revenue performance in 2H, due to a shift in the sales mix dynamics with management reaffirming its expectation that FY25 sales will surpass those reported in FY24.
Allergy Therapeutics has announced positive interim efficacy biomarker analysis from the first two of four peanut-allergic patient cohorts in the Phase I/IIa clinical trial of VLP Peanut, PROTECT. Analysis from the first two cohorts has shown that treatment with VLP Peanut resulted in a meaningful dose-dependent reduction in skin sensitivity to peanut allergen, with treated patients in cohort 2 showing a 48% reduction in wheal size (the raised, swollen area on the skin that appears after exposure to an allergen) after a skin-prick test compared to an 8% reduction in those treated with placebo. While we acknowledge this to be an early efficacy sign, the dose-dependent relationship is highly encouraging and is an important demonstration of the drug’s effectiveness: if higher doses lead to better outcomes, it suggests VLP Peanut is working as intended in tapering the immune system’s response to peanut allergen. This interim analysis stage involved 12 peanut-allergic patients across three treatment groups, and, to date, no relevant adverse safety signals have been noted. The peanut allergy market has the potential to grow into a multi-billion-dollar therapeutic segment, a view we believe is shared in the market, given previous M&A activity in the space of Nestlé’s $2.1bn acquisition (August 2020) of Aimmune Therapeutics for its peanut immunotherapy product, Palforzia.
Allergy Therapeutics has announced that a full marketing authorisation application (MAA) has been submitted to the German health regulatory authority, the Paul Ehrlich Institute (PEI), in relation to the company’s short course duration grass pollen allergen immunotherapy, Grass MATA MPL. The application is supported by data from the pivotal G306 study and has been submitted under a national procedure process in Germany, with the formal review process expected to being shortly. Whilst we cannot predict regulatory review timelines, we would expect to hear an outcome from the review within the next 12 months. In our view, the MAA marks an important regulatory milestone towards the launch of Grass MATA MPL and, should a positive outcome be received, we believe the commercial rollout could begin within the next 12-18 months, providing the group with access to Europe’s largest allergen immunotherapy market.
Allergy Therapeutics (AGY) has reported full-year results to end-June 2024, in line with its July 2024 trading update. Revenues declined by 7% YoY to £55.2m from £59.6m, due to manufacturing capacity constraints, but H2 2024 saw period-over-period growth of 2% (£21.6m vs H2 2023: £21.2m) While this may be regarded as marginal, we believe it represents an important indicator of a stemming in the decline in revenue; and it is the first period of half-year growth since 2021. The implementation of cost-control initiatives also saw the group’s operating loss pre-R&D and exceptional costs decline by 25% to £11.1m from £14.8m. Post-period, AGY further strengthened its cash position, entering into a new £40m (£20m committed) secured senior loan facility with Hayfin Healthcare Opportunities and increasing the existing shareholder loan with major shareholders SkyGem Acquisition and Southern Fox to £50m (previously £40m) while extending the repayment term to October 2030 (previously January 2027). With clarity over the company’s financing and its manufacturing issues now appearing to be remedied, we believe Allergy is in a position of operational strength to return to top-line revenue growth in FY 2025 and beyond.
Allergy Therapeutics has announced it has entered into a £40m (£20m committed) secured senior loan facility with Hayfin Healthcare Opportunities LuxCo Sarl, a fund managed by leading alternative asset management firm Hayfin Capital Management (Hayfin). Additionally, the company has increased its existing shareholder loan facility with major shareholders SkyGem Acquisition and Southern Fox to £50m (previously £40m) and extended the repayment term of the facility to October 2030 (previously January 2027). To date, the group has drawn down £27.5m (currently outstanding), leaving an undrawn, uncommitted, balance of £22.5m. Management is confident that the combined £20m of committed Hayfin funding and £42.5m of uncommitted facilities provides sufficient capital to enable the group to execute on its strategic objectives of growing existing market share, rolling out new product launches, driving R&D pipeline progression and entering new markets. In our view, the external validation provided by securing a new debt financier in Hayfin, together with the additional support from existing major shareholders, further evidences the value of AGY’s asset base, product portfolio and future market potential of the group’s allergen immunotherapy franchises.
1st October 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced, or it is a rumour Dish of the day Admissions: None Delistings: None What’s baking in the oven? Potential**** Initial Public Offerings: ITF announced: 18th September 2024: GenIP aims to list on the AIM market on 2 October 2024. It is targeting to raise £1.5m and anticipating a £6.5m market cap. GenIP is a portfolio company of London-based intellectual property investor Tekcapital PLC (TEK.L). GenIP is using Generative Artificial Intelligence (GenAI), whose mission is to empower organisations to better evaluate and commercialise technology discoveries through two distinct, yet complementary, services namely; providing bespoke enhanced research reports assessing the market potential for new technological innovations by using the Company's GenAI driven proprietary software, InventionEvaluator; and providing executive recruitment services to match technology organisations with experienced executives and business leaders using the Company's GenAI-driven proprietary software, Vortechs. 30th September 2024: Applied Nutrition, the sports nutrition, health and wellness brand announced that it is considering an IPO onto the LSE Main Market. Across the four ranges, the Group sells approximately 100 different products, with flavour and format combinations across those products resulting in over 500 stock keeping units. July 2024 YE numbers reported revenue of £86m and EBITDA of £25.9m. Offer details TBC but it would comprise existing shares to be sold by certain existing shareholders of the Company. Our daily digest of news from UK Small Caps If you would like to unsubscribe, please email enquiries@hybridan.com with “unsubscribe me”. Hybridan Chefs research@hybridan.com Banquet Buffet*** Allergy Therapeutics 4.4p £209m (AGY.L) The integrated commercial biotechnology Company specialising in allergy vaccines today announced an update on the Group's working capital position. Following tight cost control initiatives and changes to the phasing of R&D expenditure, the Group has successfully extended its cash runway into late-October. There remains a further £12.5m of uncommitted funding available under a Loan Facility and the Company is at an advanced stage on further debt funding to support its ongoing operations and development pipeline. Preparation of Allergy Therapeutics' preliminary financial results for the year ended 30 June 2024 is well underway and the Group now expects to publish its report by the end of October. Armadale Capital 0.2p £1.3m (ACP.L) The investment Company focused on natural resource projects in Africa announced its unaudited interim results for the six months ended 30 June 2024. During the period under review Armadale diversified its investments to include a high grade silver project in Idaho by investing in an option over a 51% interest in the Canyon Silver Project in three stages. Armadale has continued to progress baseline environmental monitoring and explore potential funding options. During the half, the neighbouring graphite project in Tanzania owned by Black Rock Mining Limited secured material funding which the Company believes may prompt further interest in, and facilitate ongoing discussions with regard to, Armadale's efforts to secure funding for the Mahenge Graphite Project. Character Group 277p £52m (CCT.L) The designer, developer and international distributor of toys, games, and giftware announced a trading update ahead of the publication of the Company's 2024 audited annual results. The Group expects its adjusted profit before tax for the financial year ended 31 August 2024 to be in line with current market expectations. Initial sales of products for the Christmas '24 season are showing encouraging signs, especially new introductions. The Group reports having a solid balance sheet with a healthy cash balance. FY results are scheduled to be released in December 2024. Creo Medical 23p £83.2m The medical device Company has announced that it has raised approximately £12m by way of the Placing at an Issue Price of 24 pence per share. The proceeds raised will be used to continue the development of Creo's technology as well as mitigating against any completion risk associated with the divestment of a 51% controlling stake in Creo Europe, announced on 18 September 2024. When combined with the proceeds from the Sale, the proceeds from the Fundraising will ensure the business is sufficiently funded to profitability. Cykel AI 4.75p £19.9m (CYK.L) The UK-based technology Company specialising in artificial intelligence products announced its unaudited financial results for the six months ended 30 June 2024. The group successfully completed the acquisition of Aquis-listed Cykel AI plc (now called Cykel AI Development Ltd) on 27 June 2024 with a combined market capitalisation of approximately £20m. The group completed an IPO on Aquis on 25 October 2023 with a market capitalisation of approximately £6m. The deal flow of potential partners and clients remains strong, and Directors continue to evaluate exciting new opportunities that will generate long-term value for investors. ECO Animal Health 81p £54.9m (EAH.L) The global animal health Company with a portfolio of marketed veterinary products and a maturing proprietary R&D pipeline today announced an update on its trading for the six months ending 30 September 2024. Aivlosin continues to gain market share in key territories, particularly Brazil and India, with revenues in these regions exceeding the Board's expectations. The ECO Group is second half weighted and this pattern will continue in FY 2025. The recent challenges faced in China and Southeast Asia will lead to revenue for the full year to be materially below the market’s expectations. Jaywing 1.6p £1.5m (JWNG.L) The marketing and data science business specialising in integrated marketing and risk and data consulting announced an update to its recent trading and the status of its funding. Trading continues to be challenging overall, but with marked differences by geography and service. Australia continues its year-on-year revenue growth and the wider APAC region, will deliver record revenues and profitability this financial year. The UK is more mixed with clients delaying or reducing spend. The Company is now in constructive discussions with its shareholder lenders in order to secure additional financial headroom to enable the Company to complete its restructuring. Kibo Energy *Suspended* (KIBO.L)* The renewable energy-focused development Company announced that it has signed an agreement with RiverFort a 3.25% shareholder, to provide for partial settlement of the current outstanding balance on an existing loan of £462,871 including interest and fees by sale of its remaining 19.52% interest in Mast Energy Developments PLC (MED) to RiverFort. The MED Share Sale will reduce the outstanding balance on the RiverFort Loan to £342,797. Petro Matad 2.25p £33.4m (MATD.L) The Mongolian oil Company, announces that Heron-2, the first development well to be drilled on the Petro Matad operated Heron Oil Field in Block XX in the Tamsag Basin of eastern Mongolia, has reached total depth and wireline logging has been completed. Heron-2 reached a total depth of 2,908m seven days ahead of schedule. An oil zone of 18m gross thickness was encountered which wireline logging indicates is very likely the same stratigraphic unit as that successfully tested in the Heron-1 discovery well. Production casing has been run in preparation for a well testing programme. Skillcast 46.5p £41.6m (SKL.L) The provider of compliance training and e-learning announced the launch of CoreCompliance, a staff compliance training portal tailored for small businesses, particularly those in financial services. This turnkey portal delivers essential compliance training, assessments and monitoring tools to help businesses ensure that their staff stay compliant with ever-evolving regulations. It replaces the Skillcast Basic Plan and offers more courses, knowledge checks, and other features.
AGY CCT CREO EAH KIBO MATD SKL D6BE
Allergy Therapeutics has announced that the second cohort of allergic patients in its phase 1/2a clinical trial of VLP Peanut, PROTECT, has now completed dosing. Patients in this cohort received up to a 50-fold dose increase from the initial dose following three further incremental increases in dose and, importantly, no relevant safety or tolerability issues were observed at these higher doses. This announcement follows the June 2024 update that reported the first cohort of patients had completed three incremental dose increases with no safety or tolerability issues. In addition, a further cohort of healthy patients in the trial have received a 400-fold dose increase of VLP Peanut. These trial results have provided Allergy Therapeutics with “strong confidence” that the VLP technology is safe and well tolerated. Significantly, the trial's external safety review committee has approved the progression of the trial to higher doses in cohort 3 allergic patients and cohort 4 healthy volunteers. Dosing of these final cohorts is expected to complete in H1/25. We believe Allergy Therapeutics provides a compelling equity thesis for investors that has the potential to create significant future value.
We initiate coverage of Allergy Therapeutics, a revenue generating, speciality pharmaceutical company developing new medicines for the treatment of severe allergies. Unlike typical early-stage drug development companies, Allergy has established a diverse portfolio of brand recognised allergy products that it has been selling into the European market for the past 20 years. Having solidified a commercial footprint in Europe, management is now looking to execute on its growth strategy, which hinges on (i) expansion into the highly lucrative US allergy immunotherapy market, currently valued at c$2.0bn, and (ii) transitioning to a portfolio of high-value, market-registered allergy products. We believe that Allergy is well on its way to realising such growth ambitions with the expected launch of the company’s flagship, ultra short-course grass pollen treatment, Grass MATA MPL, in Europe within the next 12 to 18 months and the blockbuster potential of its peanut allergy vaccine clinical candidate, VLP Peanut. In our view, these programmes provide a compelling equity thesis for investors that have the potential to create significant future value for shareholders. We initiate with a 13p target price underpinned by a DCF model.
Allergy reports positive progress in the VLP Peanut PROTECT Phase I/IIa trial. The first cohort of peanut allergic patients has completed three incremental dose increases with no relevant safety or tolerability findings. The trial is now set to continue to the next cohort of allergic patients in the dose escalation. We continue to expect full data from the trial later in 2024. Allergy Therapeutics commenced the subcutaneous dosing of peanut allergic patients in the Phase I/IIa PROTECT trial in March. The first cohort of peanut allergic patients has now completed three incremental dose increases over the past two months with no relevant safety or tolerability findings. The trial is now set to continue to the next cohort of allergic patients in the dose escalation. As a reminder for investors, the PROTECT trial has involved both healthy volunteers and peanut allergic patients and consists of a Part A and a Part B. Part A involved subcutaneous immunotherapy (SCIT) dosing in healthy volunteers (Group A1) and skin-prick testing in peanut allergic patients (Group A2), the latter of which was completed in April 2023. The trial has moved to Part B, a double-blind placebo-controlled part, enrolling peanut allergic subjects, with first dose cohort now completed. Up to 36 peanut-allergic subjects are expected to be enrolled in Part B of the clinical trial, should the dosing advance to the highest does as currently planned. In addition to progress with the peanut allergic patients, the third cohort of healthy subjects has also completed without relevant safety and tolerability issues. This cohort was dosed at a 400-fold increase from the first dose administered. This high dose suggests that the VLP technology is safe and well tolerated at high cumulative doses. The company remains on track to complete and report the full results of the PROTECT trial later in 2024. This data is expected to include the first biomarker-led efficacy data among higher-dose peanut allergic patients in the next cohorts of the trial. The results are expected to inform the design for the Phase IIb study. Allergy Therapeutics interim results in March indicated half year revenues of £33.6m, with operating loss pre-R&D and exceptional costs of £0.1m. R&D costs in the period increased to £11.4m, reflecting the costs associated with the pivotal G306 Phase III trial of Grass MATA MPL and preparation for the PROTECT trial, resulting in an operating loss of £11.9m. Allergy ended the period with Net Debt of £11.9m. Post period it drew down a further £15m of the £40m amended loan facility (previously £7.5m drawn), resulting in the extension of its cash runway to Q1 FY2025. We maintain our recommendation for Allergy at Under Review.
This morning, Allergy Therapeutics announces positive discussions with the PEI (Paul Ehrlich Institut) regarding the results of the pivotal G306 Phase III trial, with the PEI confirming that – subject to the usual regulatory approval procedures and data analysis – Allergy may proceed with an MAA, which the group continues to intend to submit in Q4 2024. We expect this to remain the immediate focus for the company alongside exploratory work for potential collaborations for US expansion. This morning, Allergy Therapeutics has announced updates on progress with the group’s MAA (Marketing Authorisation Application) preparation for Grass MATA MPL, Allergy’s short-course subcutaneous allergen-specific immunotherapy (SCIT) candidate that aims to address the cause of symptoms of allergic rhinoconjunctivitis due to grass pollen. The company notes positive discussions with the PEI (Paul Ehrlich Institut) regarding the results of the pivotal G306 Phase III trial, and in support of CMC (Chemistry, Manufacture and Controls) requirements and the subsequent regulatory pathway towards national registration of Grass MATA MPL. Accordingly, the PEI confirmed that, subject to the usual regulatory approval procedures and detailed data analysis, Allergy may proceed with an MAA, which the group continues to intend to submit in Q4 2024. We remind investors that the regulatory pathway is part of the TAV (Therapieallergene-Verordnung or Therapy Allergen Regulation) which is the regulatory process in Europe which manages the authorization of allergy products via the Paul Ehrlich Institut. The TAV was commenced in 2008 as a mechanism to allow companies to generate safety and efficacy data where this was not previously available, and to gain a formal regulatory approval for allergy therapies. Currently, we continue to believe that Allergy´s Grass MATA MPL immunotherapy candidate appears to be the only grass SCIT product to be able to proceed to MAA within the TAV process. In this instance, current named-patient SCIT products would withdraw from the market and Allergy’s grass candidate may become the only grass SCIT registered under this new regulatory environment. We consider this positioning continues to reflect the strength and capability of Allergy’s technology platform and the clinical successes achieved to date, notably with the G309 exploratory and G306 pivotal studies. Furthermore, we also recognize the wider importance of a SCIT product in terms of US potential, a territory where we consider subcutaneous delivery to be critical for commercial success. With regard to the US regulatory process, and as previously communicated, a requirement for the FDA will involve a further study known as G307 to meet the required total number of US subjects treated using the product: Allergy is planning for meetings with the FDA to agree a route forward. Consequently, the immediate focus for Allergy will be preparing the data package for national MAA in Q4 – as described above – alongside exploration for potential collaborations for US expansion. We maintain our recommendation for Allergy at Under Review, and refer investors to previous updates regarding company financing and trading performance, and will update in due course.
The annual EAACI (European Academy of Allergy and Clinical Immunology) Congress frequently sees Allergy Therapeutics present key scientific findings: this year the company will deliver 12 poster presentations highlighting lead programmes, with additional events including the hosting of a symposium covering regulatory and clinical challenges in allergen immunotherapy trials, a plenary session on adaptive approaches to clinical development – as applied in the successful G309 and G306 studies – and an embargo session on an upcoming paper on VLP Peanut on a recently accepted article in the peer reviewed Journal of Allergy and Clinical Immunology. This morning Allergy Therapeutics has announced a raft of scientific presentations, which will highlight key findings from its research portfolio, to be presented at the forthcoming European Academy of Allergy and Clinical Immunology (EAACI) Congress, taking place from today until 03 June 2024 in Valencia, Spain. Investors will be aware of Allergy’s consistent and high-profile presence at the annual EAACI meetings, being the world’s largest scientific conference that specialises in the field of allergy, and the company will be presenting 12 posters this year across the congress. As highlighted in this morning’s release, there are three areas of focus in particular that will be highlighted amongst the poster presentations. The first comes with the company’s lead asset Grass MATA MPL – Allergy’s short-course subcutaneous allergen-specific immunotherapy (SCIT) candidate to address the cause of symptoms of allergic rhinoconjunctivitis due to grass pollen – demonstrating the positive results from the pivotal Phase III G306 trial. We direct investors to our commentary across the company’s recent updates and analysis on G306 from last year in November and December, and most recently earlier this month. We expect the findings from the G306 trial, alongside results of the earlier G309 exploratory field study, will support Allergy’s marketing authorisation application (MAA), which the company plans to submit in Q4 2024. Moving to the company’s key peanut allergy programme, VLP Peanut, Allergy will present the beneficial safety and tolerability results from the healthy subject subcutaneous dosing cohorts of the Phase I/IIa PROTECT trial: this saw no major safety or tolerability findings. The trial is ongoing and progressed in March 2024 to subcutaneous dosing of peanut allergic patients, marking the start of the clinical proof of concept phase using biomarkers to assess preliminary efficacy. Finally on the poster presentations, the company notes that results from analysis of patient and caregiver preferences for different venom and pollen immunotherapy approaches will be presented and their implications on adherence and treatment acceptance. Elsewhere, we note three further events during EAACI 2024. First, the company will be hosting a symposium, “Setting a new standard for grass subcutaneous immunotherapy,” on Sunday 02 June, chaired by Professor Dr. Stefan Zielen, Head of the Institute for Respiratory Medicine, Frankfurt, Germany. The symposium will include presentations covering regulatory and clinical challenges in allergen immunotherapy trials, as well as results from Allergy’s pivotal Phase III G306 trial of Grass MATA MPL by experts from the US and EU. Next, Professor Mohamed Shamji (Imperial College, London, and EAACI Vice President Congresses) will showcase in a plenary session Allergy’s scientific adaptive approaches to clinical development, as applied in the G309 and G306 studies. Finally, Professor Shamji will host an embargo session at the closure day of the EAACI conference to release Allergy’s recently accepted VLP Peanut paper in the peer reviewed Journal of Allergy and Clinical Immunology. This session will highlight the promising biomarker safety and efficacy profile of VLP Peanut, including the first clinical results supporting the hypo-allergic profile of VLP Peanut based on the skin test results from the PROTECT Phase I/IIa study. Overall, we regard Allergy’s presentation and symposium programme for EAACI 2024 represents a number of further opportunities for Allergy Therapeutics to demonstrate its leadership in key strategic areas. We maintain our recommendation for Allergy at Under Review, and refer investors to previous updates regarding company financing and trading performance, and will update in due course.
Allergy Therapeutics has announced further detail from the positive top line results from the company’s pivotal Phase III field study G306 for Grass MATA MPL. Late last year, the trial successfully met its primary endpoint at interim analysis, and today the company announces a 20.3% reduction in the Combined Symptom & Medication Score (CSMS) with high statistical significance (p=0.00024). In the context of the earlier G309 results, we consider the G306 improvement to be a highly meaningful reduction in the daily symptoms of participants on active treatment, and would reflect a significant reduction in the use of relief medication of those patients. A marketing authorisation application (MAA) is planned for Q4 2024. This morning, Allergy Therapeutics has announced further detail from the positive top line results from the company’s pivotal Phase III field study G306 to evaluate the efficacy and safety of Grass MATA MPL. Investors will know this as Allergy’s short-course subcutaneous allergen-specific immunotherapy (SCIT) candidate to address the cause of symptoms of allergic rhinoconjunctivitis due to grass pollen. As previously announced on 14 November 2023, the trial successfully met its primary endpoint at interim analysis, with further positive analysis announced on 13 December 2023. As outlined in today’s release, the study (conducted in the EU and US) comprised an evaluation to assess the impact of the treatment comprising six pre-seasonal injections given over 14 weeks. The company has previously highlighted that the primary endpoint of the trial, the Combined Symptom & Medication Score (CSMS) demonstrated a highly statistically significant reduction compared with placebo over the peak pollen season: today’s release highlights the improvement at 20.3% (p=0.00024). In the context of the G309 exploratory study [statistically significant reduction in CSMS of 29.1% (6 weeks treatment) and 39.5% (14 weeks) vs placebo respectively], we consider the G306 improvement to be a highly meaningful reduction in the daily symptoms of participants on active treatment, and would reflect a significant reduction in the use of relief medication of those patients. As previously announced by the company, the study also demonstrated a statistically significant improvement in the rhinoconjunctivitis quality of life questionnaire (RQLQ) (p=0.0003) during the peak season. Additionally, the company has determined that the strong statistically significant (p<0.0001) induction of the protective biomarker immunoglobulin (IgG4) after treatment with Grass MATA MPL – previously announced on a qualitative basis – in fact reflected a circa five-fold increase compared with placebo, with this performance consistent with data from the earlier G309 exploratory field trial. We view the continued consistency between biomarker, quality of life and treatment data as a strong reflection of the efficacy signal for Grass MATA MPL. Finally, we note the further detail given today, with the study including 555 subjects with allergic conjunctivitis and/or rhinitis which were randomized (278 and 277 patients received Grass MATA MPL and placebo, respectively) with 528 (95%) completing all six injections of Grass MATA MPL or placebo. We consider the high levels of adherence bode well for a potentially widely used therapeutic strategy. Today’s release also notes that demographics, allergic history and immunoglobulins were generally well-balanced at baseline between the Grass MATA MPL and placebo groups. In terms of the wider context of Allergy’s Grass MATA MPL programme, we remind investors that the regulatory pathway is part of the TAV (Therapieallergene-Verordnung or Therapy Allergen Regulation) which is the regulatory process in Europe which manages the authorization of allergy products via the Paul Ehrlich Institut. This is somewhat separate to the typical pharmaceutical regulatory infrastructure which deals with other therapeutic products, and with which most investors will be familiar. The TAV was commenced in 2008 as a mechanism to allow companies to generate safety and efficacy data where this was not previously available, and to gain a formal regulatory approval for allergy therapies. Currently, Allergy´s Grass MATA MPL immunotherapy candidate appears to be the only grass SCIT product to be able to proceed to MAA within the TAV process. In this instance, current named-patient SCIT products would withdraw from the market and Allergy’s grass candidate may become the only grass SCIT registered under this new regulatory environment. We consider this positioning continues to reflect the strength and capability of Allergy’s technology platform and the clinical successes achieved to date, notably with the G309 exploratory and G306 pivotal studies. Furthermore, we recognize the wider importance of a SCIT product in terms of US potential, a territory where we consider subcutaneous delivery to be critical for commercial success. As noted in today’s release, preparation for the marketing authorisation application (MAA) is ‘well underway’ with a planned submission in Q4 2024, with potentially a circa 12-month timeframe towards approval. Assuming success, this would then allow the product to be promoted commercially rather than provided on a named-patient basis, which is currently allowed under the TAV for products formally undergoing clinical trials. The company also expects to present full results of the G306 study at the upcoming European Academy of Allergy & Clinical Immunology conference in June 2024 and to submit the data for peer-reviewed publication later this year. We maintain our recommendation for Allergy at Under Review, and refer investors to previous updates regarding company financing and trading performance, and will update in due course.
Allergy Therapeutics has announced interim results, which follow last month’s trading update which pre-flagged revenues and period-end cash balances. In parallel today, a separate announcement updates as to the company’s funding position which will see a further £15m of the £40m Amended Loan Facility to be drawn down during Q2 CY2024, in addition to the £7.5m already drawn down. As a consequence, Allergy expects to have extended its cash runway to Q1 FY2025 or, given the company’s June year-end, Q3 CY2024. We maintain our recommendation for Allergy at Under Review and will update pending further announcements from the company. This morning, Allergy Therapeutics has announced interim results in parallel with a separate announcement setting out an update to the company’s funding position which will see a further £15m of the £40m Amended Loan Facility to be drawn down during Q2 CY2024. As a consequence, Allergy expects to have extended its cash runway to Q1 FY2025 or, given the company’s June year-end, Q3 CY2024. In terms of the interim update, we refer investors to the company’s 1H trading update from last month which already flagged first half revenues of £33.6m (2023 H1: £39.9m) (-16% reported and at constant currency) due to the allocation of manufacturing capacity towards investigational medicinal product batches for use in clinical trials, and the programme of supply chain and quality improvement. We note that today’s statement highlights that demand for the company’s products remains ‘robust’. Operating loss pre-R&D and exceptional costs was £0.1m (2023 H1: £1.0m operating profit pre-R&D and exceptional costs), losses being mitigated by efforts to reduce distribution and administrative costs through cost control initiatives. R&D costs increased during the period to £11.4m (2023 H1: £8.5m) reflecting costs associated with the pivotal G306 Phase III trial of Grass MATA MPL. Operating loss was £11.9m (2023 H1: £8.0m), and the loss before tax was £14.9m (2023 H1: £8.2m). The tax charge of £0.7m (2023 H1: £0.3m) relates to the overseas subsidiaries. Operating cash outflow was £10.8m and investing outflow £1.8m, offset by a net inflow of £11.2m from the net proceeds of the issue of equity shares and repayment of shareholder loans. At period-end the group had cash of £13.5m (30 June 2023: £14.8m) and debt of £1.6m (30 June 2023: £27.1m), with the debt reduction achieved through the completion of the £40.75m equity financing to restructure the Group’s balance sheet. The loan facility, subsequently amended, now provides £40m available to be drawn down from 15 January 2024 until 15 January 2026 with interest payable semi-annually at 12 per cent. per annum and a repayment date of 15 January 2027. We note that £7.5m is currently drawn down under the amended facility while the lenders and the company have also agreed to a further drawdown of £15m, expected during April 2024. Following this, Allergy expects that additional funding will be required during Q1 FY2025 (or Q3 CY2024 given Allergy’s June year-end) onwards for trading, working capital, capital expenditure and continuing R&D programmes. We direct investors to terms of the amended loan facility, whereby under the attached warrant instrument, on each drawdown the lenders are issued 25 warrants for each £1 drawn down up to the maximum of 1,000,000,000 warrants. The warrants entitle the holders to subscribe for new ordinary shares at a price of 4 pence per share and are exercisable in whole or in part from 1 July 2024 until 15 January 2027. We note the application of the going concern principle with regards preparation of the interims, with the caveat of material uncertainty due to the need for additional near-term funding and the balance of the Amended Loan Facility currently being uncommitted. In terms of the company’s R&D update, the progress on Grass MATA MPLY appears mainly to be focused on the collation of the full data package and discussions with regulators ahead of the planned marketing authorization submission. Preparations are also ongoing for the initiation of the G308 combined short-term and long-term paediatric clinical trial that is due to commence in Q2 2024. The VLP Peanut R&D programme is further advancing, and in March 2024 Allergy announced that subcutaneous dosing of peanut allergic patients had begun in the Phase I/IIa PROTECT trial without any relevant safety issues. The company’s outlook commentary remains consistent with last month’s update: namely that 2H sales are expected to be slightly higher than the previous year, meaning that overall sales for the full year ending on 30 June 2024 are expected to be slightly lower than the corresponding period ending 30 June 2023. We maintain our recommendation for Allergy at Under Review and will update pending further announcements from the company.
Allergy Therapeutics has announced the commencement of subcutaneous dosing of peanut allergic patients in the Phase I/IIa VLP Peanut PROTECT trial. This marks the start of the clinical proof of concept phase using biomarkers to assess preliminary efficacy and is a key advance in the PROTECT study. Meanwhile dose escalation in healthy subjects has progressed to a third cohort to pave the way for dose escalation to similar strengths in peanut allergic patients. We direct investors to recent company commentary (14 February 2024) with respect to its 1H trading update and funding requirement in financial Q4, and we maintain our recommendation for Allergy at Under Review. We will update pending further announcements from the company. This morning, Allergy Therapeutics has announced the commencement of subcutaneous dosing of peanut allergic patients in the Phase I/IIa PROTECT trial evaluating the company’s VLP Peanut vaccine candidate. The news marks the start of the clinical proof of concept phase using biomarkers to assess preliminary efficacy and is a key advance in the PROTECT study. Patients allergic to peanuts have previously undergone skin-prick testing in part A of the PROTECT trial. An external safety review committee (SRC) subsequently determined that no safety signals had been observed and it was safe to proceed with incremental subcutaneous dosing in healthy subjects in the Phase I stage and in peanut allergic patients in the Phase IIa part of the trial. As a reminder for investors, the PROTECT trial has involved both healthy volunteers and peanut allergic patients and consists of a Part A and a Part B. Part A involves subcutaneous immunotherapy (SCIT) dosing in healthy volunteers (Group A1) and skin-prick testing in peanut allergic patients (Group A2), the latter of which was completed in April 2023. Part B of the clinical trial is double-blind, placebo-controlled and has commenced in peanut allergic subjects at multiple clinical trial sites in the US. Up to 36 peanut-allergic subjects are to be enrolled in Part B of the clinical trial, should the dosing advance to the highest dose as currently planned. We also note that, having already demonstrated tolerability of a 25-fold dose increase in 2 cohorts of healthy subjects, dose escalation in healthy subjects has progressed to a third cohort to pave the way for dose escalation to similar strengths in peanut allergic patients. The complete results of the PROTECT trial are anticipated to be available later in 2024. We direct investors to recent company commentary (14 February 2024) with respect to its 1H trading update and funding requirement in financial Q4, and we maintain our recommendation for Allergy at Under Review. We will update pending further announcements from the company.
Allergy Therapeutics has announced a trading update for the first half ended 31 December 2023, with commentary on pipeline seeing the company continuing to look towards the first scientific advisory meeting with regulators on Grass MATA MPL in late Q1 2024, and with ongoing progress on VLP Peanut progressing towards results of the PROTECT trial later in 2024. On commercial performance, a 16% decline in 1H revenues means full-year revenues are expected to be ‘slightly lower’ vs FY23, with the balance sheet indicating further funding required in Q4 of FY2024. We maintain our recommendation for Allergy at Under Review and will update pending further announcements from the company. This morning, Allergy Therapeutics has announced a trading update for the six months ended 31 December 2023. With regards financial performance for the first half, Allergy expects 1H revenues of £33.6m (2022: £39.9m), a reduction of 16% both on a reported and constant currency basis. The statement highlights that the decrease is attributed to the allocation of manufacturing capacity to investigational medicinal product batches for use in clinical trials. The company expects 2H sales to be ‘slightly higher’ than the previous year: accordingly, overall sales for FY24 (June year-end) are expected to be slightly lower than FY23. Regarding the balance sheet, cash balances at the period-end were £13.5m (30 June 2023: £14.8 million). Post-period, Allergy has drawn down £4m from the £7.5m committed facility, with £3.5m remaining undrawn as at 13 February 2024. The secured loan facility also includes an uncommitted amount of £32.5m. Allergy states it anticipates further funding will be required (in addition to the balance of the committed facility) during Q4 of its 2024 financial year. Regarding the company’s R&D pipeline, investors will have already recognized the progress with the Grass MATA MPL programme given the updates on the G306 Phase III trial in November and December 2023. Allergy continues to expect the first scientific advisory meeting with regulators to occur in late Q1 2024. On VLP Peanut, Allergy previously announced completion of dosing in healthy volunteers of the Phase I PROTECT trial. Following dose escalation (25-fold) and an external safety review committee approval to proceed to subcutaneous dose escalation in peanut allergic subjects, Allergy is now actively recruiting for the phase I/IIa stage of the PROTECT study: this comprises a total of four cohorts with eight patients within each cohort. The company is working with the Johns Hopkins University Dermatology, Allergy and Clinical Immunology Reference Laboratory with regards key biomarkers and Allergy expects biomarkers will provide evidence of preliminary efficacy during the second part of the VLP101 PROTECT study, prior to starting the subsequent Phase IIb stages of the clinical programme. Allergy notes that no safety issues have been observed in healthy subjects to date and the complete results of the PROTECT trial are anticipated to be available later in 2024. We maintain our recommendation for Allergy at Under Review and will update pending further announcements from the company.
Allergy Therapeutics has announced publication of its Annual Report and Accounts for the year ended 30 June 2023. Accordingly, trading in the company's shares on AIM is expected to be restored with effect from 07.30 a.m. today. Subsequent to the company’s prelims announced on 27 September 2023, a number of amendments to the final results are detailed. Following amendments, Allergy reports audited revenue for the year to 30 June 2023 was £59.6m (2022: £72.8m) which is £1.4m lower than stated in the Preliminary Results. The audited operating loss pre-research and development costs and exceptional costs was £14.8m (2022: profit of £3.4m) and full year net loss was £43.1m (2022: net loss of £13.8m). We will update in due course. This morning, Allergy Therapeutics has announced publication of its Annual Report and Accounts for the year ended 30 June 2023. Accordingly, trading in the company's shares on AIM is expected to be restored with effect from 07.30 a.m. today. Allergy released its preliminary results on 27 September 2023. Amendments to the final results subsequent to the prelims include a reduction in the current year (2023) revenue of £1.4m as recognition of the amount to settle historic rebates in Germany (also with an increase in exceptional costs for the element relating to prior years), removal of the £11.3m exceptional charge (G306 Contingent Payment) following the October 2023 equity financing, and restatement of the value of an insurance policy designed to contribute towards its obligations in respect of the German defined benefit pension scheme. Following amendments, Allergy reports audited revenue for the year to 30 June 2023 was £59.6m (2022: £72.8m) which is £1.4m lower than stated in the Preliminary Results. The audited operating loss pre-research and development costs and exceptional costs was £14.8m (2022: profit of £3.4m) and full year net loss was £43.1m (2022: net loss of £13.8m). We will update our investment thesis in due course.
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Allergy Therapeutics has announced further analysis of the dataset from the Grass G306 pivotal Phase III trial, following last month’s positive topline readout. The data show highly significant secondary efficacy endpoints with acceptable safety and tolerability, further demonstrating the beneficial effect of the Grass MATA MPL 27,600 SU product. Allergy now anticipates scientific advice meetings with health authorities in Q1 2024 to pave the way towards a marketing authorisation application. Meanwhile, we remind investors of the company’s recent funding update which highlighted lower sales expected for FY24, while extending the company’s current cash runway towards the end of January 2024 (previously December 2023). We maintain Allergy at under Review and will update pending further announcements from the company. This morning, Allergy Therapeutics has provided a further update on the data analysis of the company’s pivotal G306 Phase III trial of Grass MATA MPL. This is Allergy’s short-course subcutaneous allergen-specific immunotherapy (SCIT) candidate to address the cause of symptoms of allergic rhinoconjunctivitis due to grass pollen. Investors will recall that the company previously announced that the study was stopped for success, with no second season cohort required, and that the active treatment group demonstrated a highly statistically significant reduction in Combined Symptom & Medication Score (CSMS) (p=0.0024) compared to placebo over the peak pollen season. Today, the company further notes that the dataset demonstrated statistical significance also in the eDiary secondary endpoints, including CSMS during the entire grass pollen season, and daily medication and daily symptom scores. A statistically significant strong induction of the protective biomarker IgG4 was seen during the grass pollen season between active and placebo (p =0.0001) and there was also a statistically significant overall improvement in the quality-of-life score, according to the Rhinoconjunctivitis Quality of Life Questionnaire (RQLQ) (p =0.0003) Furthermore, no unexpected safety events were observed with Grass MATA MPL 27,600 SU product. The company is now collating the dataset for use in regulatory discussions towards a market authorisation application, with the first scientific advice meeting with regulators anticipated in late Q1 2024. In the meantime, we note the Allergy’s funding update of 11 December 2023. in which the company noted that sales for the financial year to 30 June 2024 are expected to be slightly lower than the comparable period ended 30 June 2023. Meanwhile the impact of cost control initiatives mean the company’s cash runway is now extended towards the end of January 2024 (previously December 2023). As stated by the company in this week’s funding update release, “While no firm commitments are in place to provide further funding, discussions with certain major shareholders are well advanced.” We maintain Allergy Therapeutics at Under Review and will update pending further announcements from the company.
Allergy Therapeutics has announced interim top line results from its pivotal G306 Phase III trial of Grass MATA MPL, with the primary endpoint successfully met with statistical significance. We expect further outcomes to be announced once full analysis of the data has been completed, anticipated in mid-December. While we await the release of the additional analysis, the meeting of the primary endpoint – with the adaptive trial stopped for success – is a significant milestone for the Grass MATA MPL programme. Following recent corporate activity and in light of commentary from the company – we note the funding update of 06 November 2023 that the group expects to require additional funding by the end of December 2023 – we place our recommendation for Allergy Therapeutics to Under Review and will update in due course.
With the first application of VLP Peanut in peanut allergic patients, this now means that the dosing phase of Allergy’s Phase I PROTECT trial investigating the company’s novel short-course peanut allergy vaccine candidate, VLP Peanut, is underway. Our recommendation remains Under Review pending updates from the company with regards funding discussions and we refer investors to our commentary of 20 January 2023 in relation to the company’s interim trading update for further detail. The stock was suspended from trading on AIM on 03 January 2023 pending publication of its annual audited accounts.
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Any reference to a partner in relation to Hybridan LLP is to a member of Hybridan LLP or an employee with equivalent standing and qualifications. A list of the members of Hybridan LLP is available for inspection at the registered office, 2 Jardine House, The Harrovian Business Village, Bessborough Road, Harrow, Middlesex HA1 3EX. *A corporate client of Hybridan LLP ** Arranged by most recent first *** Alphabetically arranged Dish of the day Joiners: No joiners today. Leavers: No leavers today. What’s cooking in the IPO kitchen?** Celsius Resources intends to join AIM. Currently ASX listed, Celsius is a natural resources exploration and development company principally seeking to explore and develop potential world-class copper-gold assets in the Philippines and a cobalt asset in Namibia. Amount planning to raise and anticipated market cap TBC. Expected late January 2023. Conviction Life Sciences, a newly established closed-ended investment company managed by Plain English Finance Limited, is seeking to list on Premium Segment of the Main Market of the London Stock Exchange, to invest in a conviction portfolio of life sciences and medical technology businesses, primarily in the UK, Europe and Australasia. The Company will invest in both publicly traded and private companies - c. 70% and c. 20% of the total portfolio value respectively. The Company will target an annualised Total NAV Return of 20% over the long-term. Targeting to raise c.£100m. Delayed to 3rd February 2023. Our daily digest of news from UK listed Small and Mid caps Banquet Buffet*** Allergy Therapeutics SUSPENDED (AGY.L) The fully integrated commercial biotechnology company specialising in allergy vaccines, provides a trading update for the six months ended 31 December 2022. The Group expects revenue to be £39.9m (2021: £48.7m) a reduction of 18%. This decrease is primarily due to the previously announced voluntary short-term pause in production and strategic streamlining of older products in the portfolio. The cash balance was £15.2m (30 June 2022: £20.5m). Pursuant to the subscription and debt financing announced on 29 September 2022, the Company received £7m from the issue of new ordinary shares and expects to receive £10m from the issue of loan notes on 28 February 2023. The Group expects sales to continue at a similar level compared to last year, before recovering in the next financial year. Big Technologies 267.6p £776.8m (BIG.L) The UK-based remote people monitoring technology company, issues a trading update of the full year results ended 31st December 2022. The Group has accounted for revenue expected to be approximately £50m (2021: £37.6m) and adjusted EBITDA to be in excess of £30m (2021: £20.6m), marginally ahead of current market expectations. Net cash (stated prior to lease liabilities of £0.7m) increased to £67.5m. The Group expects further revenue growth and increase market share to scale-up business operations. DSW Capital 91p £20m (DSW.L) A profitable, mid-market, challenger professional services licence network announces a trading update. The second half to 31 March 2023 (FY23) is being impacted by macro-economic uncertainties, and as such the Board believes the Group will not achieve current market expectations. The Board revises its financial guidance for the year ending FY23, with network activity levels in FY23 expected to be broadly similar to FY22, revenue is expected to be between £2.8m-£3.1m (FY22: £3.0m) and expected EBITDA between £1.4m-£1.7m (FY22: £2.2m). At 31 December 2022, the Group held cash balances of £4.8m. The Board continues to evaluate opportunities to grow through diversification and expansion of new service lines. Gresham House 750p £287.1m (GHE.L) The specialist alternative asset manager committed to sustainable investing, provides an update on recent activity across a range of asset classes supporting regional prosperity. Portfolio Company, Wildanet, has been awarded new contracts worth £36m to connect c.20,000 hard-to-reach homes and businesses in South West and Mid Cornwall. Baronsmead Venture Trust and Baronsmead Second Venture Trust managed by Gresham House, has raised £17.3m in the first 10 days of this latest fundraise. Gresham House Residential Secure Income LP has agreed a £40m deal with Countryside Partnerships, to fund 167 new affordable homes in Chippenham, Wiltshire. Mirriad Advertising 5.2p £14.5m (MIRI.L) The UK based company has been developing the market for in-content advertising in the US by building commercial partnerships on the supply-side, provides a trading update. The Company confirmed that revenue for the financial year to 31 December 2022 (FY 2022) was £1.51m. Revenues pivoted from China to the US over the last 2 years with US revenue increasing from 14% of total revenue for FY 2020, to 44% in FY 2021 and 78% in FY 2022. As at FY 22 the Company had £11.3m of cash on its balance sheet, ending the year in a better position due to tight and ongoing efficiency measures. The Board expects that with the appropriate funding the Company is on track to deliver its growth strategy and roadmap for the future. TruFin 59p £55.6m (TRU.L) The software and niche lending solutions business provides a trading update for 12 months ended 31 December 2022. Revenues for the 12 months are expected to be £16.0m (FY21: £13.1m), representing year-on-year growth of 22%. This has predominantly been driven by revenue growth of more than 350% at Satago and over 25% growth at Oxygen Finance Group ltd. The Adjusted Loss Before Tax is expected to be in line with market expectations at no more than £8.1m (FY21: £8.4m). The Company ensures it is well positioned to achieve another profitable growth during 2023. San Leon Energy 35.05p £157.7m (SLE.L) The independent oil and gas production, development and exploration company focused in Nigeria, notes the announcement made on 19 January 2023 by Decklar Resources Inc. (Decklar) in Canada. San Leon has a 11% shareholding in Decklar Petroleum Limited (DPL), the local subsidiary of Decklar operating in Nigeria, and has also made a US$5.5m loan to DPL, via 10% per annum unsecured subordinated loan notes. Decklar and Millenium (co-venturer) have now increased production from the Oza Oil Field to a total rate of approximately 1,300 barrels of oil per day (bopd) following the restart of production at approximately 900 bopd from the Oza-1 well and new production at approximately 400 bopd following minor repairs to the Oza-4 well. With continued production and delivery of crude oil it is expected that regular billing and receipts of sales proceeds will occur. Spirent Communications 230.7p £1,411.3m (SPT.L) The leading provider of automated test and assurance solutions for next-generation devices and networks, today issues a trading update for the financial year ended 31 December 2022. The Group delivered their full year results in line with expectations. Full year revenue grew by 5.5% to $607m and is expect to deliver an adjusted operating profit slightly ahead of market consensus. The Group's cash position closed at $210m and are positioned to deliver further strategic and operational progress. The Group continue to invest in leading technology solutions across our portfolio. Vela Technologies 0.018p £2.9m (VELA.L) An AIM-quoted investing company focused on early stage and pre-IPO disruptive technology investments, announces that the Company has invested £49k in Ethernity Networks Ltd through the purchase of 700k ordinary shares. Vela's investment is part of a placing for Ethernity that raised £1.55m (before expenses). In addition, Ethernity raised £0.1m by way of a broker option, as announced by Ethernity on 19 January 2023. 4imprint Group £46.03 £1,292.6m (FOUR.L) The international direct marketer of promotional products provides a trading update. The Group’s revenue for 2022 was approximately $1.14bn, an increase of 45% ($350m) compared to $787m in 2021. Profit before tax is expected to push the analysts' forecasts, to over $100m. The unaudited net cash balance at the 2022 year-end was $86.7m, (2021: $41.6m), leaving the Group well-funded entering the 2023 financial year. The Board is content with the Group's progress in 2022, which reflects clarity of strategy and the business model. The Group enters 2023 in a strong hold. If you would like to unsubscribe, please email enquiries@hybridan.com with “unsubscribe me”. Chef: Emily Liu 0203 764 2344 emily.liu@hybridan.com Chef: Sacha Morris 0203 764 2345 sacha.morris@hybridan.com
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Allergy Therapeutics has announced a trading update for the six months ended 31 December 2022. Revenues for the period are expected to be £39.9m (2021: £48.7m) representing a reduction of 18% compared with last year, driven primarily by the previously announced voluntary short-term pause in production in the UK. Second half revenues are expected to continue at a similar level compared with last year. Cash at period end was £15.2m (30 June 2022: £20.5m) and Allergy continues to review its funding options given the impact of the manufacturing pause that has resulted in the need for additional near-term funding. The company states today that it ‘is increasingly confident that its funding discussions will result in a positive outcome’. We move our recommendation to Under Review (previously Restricted following the late September 2022 fund raise) and will update in due course.
Trinity Delta view: The pivotal G306 Grass MATA MPL Phase III trial is one of two important clinical studies planned, with the other the Phase I PROTECT VLP Peanut trial. Data for both of these key pipeline assets are expected next year, with results from G306 during Q423. The G306 study is fully funded, and should generate reliable and robust results given the size and scope. Management sees $300-400m peak sales for Grass MATA MPL in the US, which could be transformational for Allergy Therapeutics. Our Allergy Therapeutics valuation is £260.8m (38.4p per share) which includes a pipeline valuation of £190.0m (28.0p/share), where we see material upside potential as key programmes, including VLP Peanut and Grass MATA MPL, progress. Following the manufacturing pause, management remains focused on cost control and capital management and is assessing and reviewing all funding options.
Allergy Therapeutics plc Allergy Therapeutics plc
Joiners: No joiners today. Leavers: No leavers today. What’s cooking in the IPO kitchen?** Ithaca Energy, a UK independent exploration and production company focused on the UK North Sea, intends to join the Premium Segment of the Main Market. Ithaca Energy is one of the largest independent oil and gas companies in the UKCS, ranking 2nd by resources and 3rd by production. The offer will initially comprise new ordinary shares and the proceeds will be used to repay existing shareholder debt, including a capital note in favour of DKL Energy Limited, the Company’s immediate shareholder. Immediately following Admission, the Company will target a free float of at least 10% of its issued share capital and expects to be eligible for inclusion in the FTSE UK indices. BWP REIT, a newly formed single asset company, announces its intention to raise £35m through the issue of 35m ordinary shares at the issue price of £1 per share, to acquire Bridgewater Place, an office-led mixed use property situated in central Leeds and valued at £63m. BWP REIT will apply for listing on the Wholesale Segment of the International Property Securities Exchange (PSX). 10 November 2022. World Chess plc, a leading chess organisation, intends to join the Main Market. World Chess Plc is the holding company of a group which aims to promote the mass market appeal of chess globally through the commercial offering of chess related activities. Euro 8m to be raised. Expected November 2022. OTAQ plc, (OTAQ.L) the technology company with three divisions: Aquaculture, Geotracking Devices and Offshore intends to delist from the Main Market and join the AQSE Growth Market. OTAQ is developing adjacent technologies to take advantage of a number of growth initiatives that will broaden the Group’s current product portfolio in the global marine aquaculture sector and facilitate entry and growth into the geotracking devices sector. Expected 9 November 2022. Raising a total of £3.6m, £2m raised. Cooks Coffee Company ltd, an international coffee focused café chain which currently owns the Esquires Coffee and Triple Two Coffee Brands, intends to join the AQSE Growth Market. The Company is the 4th largest coffee focused café chain in the UK. Cooks Coffee is currently listed on the New Zealand Stock Exchange. Raising £1.5m through a rights issue in New Zealand and a private placement. Expected 2 November 2022. TECC Capital plc, to be renamed EDX Medical Group, intends to join the AQSE Growth Market. EDX operates a molecular biology and diagnostics laboratory in Cambridge, UK, from which it performs research & development, provides Polymerase Chain Reaction (PCR) testing and genomic sequencing services, undertakes quality assurance and has established expertise in the design, development, validation and sourcing of Lateral Flow Tests on a commercial scale. 14 November 2022. Streaks Gaming plc, a UK-based provider of conversational gaming products intends to join the Standard Segment of the Main Market this autumn. The flotation is expected to value Streaks at approximately £10.2m (pre-money) and will make it the first LSE-listed "pure-play" conversational gaming company. Raising between £5-10m. Due in October. Georgina Energy, focusing on the exploration, development and monetisation of helium, hydrogen and hydrocarbon interests located in Australia intends to join AIM. Georgina Energy has two principal onshore interests: (1) Mount Winter Prospect in the Amadeus Basin in Northern Australia, which the Company has a right to earn an initial 75% interest; (2) Hussar Prospect, 100% owned by the Company, located in the Officer Basin in Western Australia. Expected late October. Our daily digest of news from UK listed Small and Mid caps Banquet Buffet*** Allergy Therapeutics 17p £115.4m (AGY.L) The fully integrated biotechnology company specialising in allergen immunotherapy, announces that it will resume production at the Freeman facility on 14th November. As a consequence of the production pause, it is currently estimated that revenue will be between approximately 13% and 18% lower than market expectations of circa £80m at current exchange rates for the year ended 30 June 2023. Business expenses for the same period are currently expected to reduce by around £3m. Aurrigo International 76p £31.7m (AURR.L) The international provider of technology solutions, announces that, as anticipated in the Company's Admission Document, it has now signed the agreement with Changi Airport Group (Singapore) for the next phase of development of the Auto-Dolly, the Company's innovative baggage transportation solution for airports. This phase will entail technology trials of the Auto-Dolly on an aircraft stand at Singapore Changi Airport and will last for approximately 6 months. European Metals Holdings 44p £81.9m (EMH.L) The mineral exploration and development company announce the appointment of Luthardt Investment GmbH, a Berlin-based consultancy specialising in energy production and government relations support. The Company believes that the European Critical Raw Materials Act will benefit the Cinovec Project, which has the potential to be a significant European source of lithium. In consideration for the engagement, the Company will issue Luthardt Investment a total of 2m unlisted options to acquire fully paid ordinary shares, exercisable at AU$0.8 on or before 30 December 2023, which shall vest in two equal tranches, subject to milestones achievements. Future Metals NL 6.6p £25.1m (FME.L) The 100% owner of the Panton PGM-Nickel (Ni) Project in the eastern Kimberley region of Western Australia, provides its financials for the quarter ended 30 September 2022. Multiple new exploration targets identified for sulphide-rich (Ni, Cu, Au, Co & PGM) zones outside of the already significant 6.9Moz PdEq Mineral Resource Estimate. Approved Programme of Works and drilling contractor secured for an initial ~3,000m drill programme, which commenced in October 2022. Cash balance was approx. A$7.6m on 30 September, with a further A$0.9m raised subsequently through the UK placement. Likewise Group 15p £36.6m (LIKE.L) The UK floor coverings distributor, provides a trading update for the financial year ending 31 December 2022. The Board is expecting profit before tax margins to be below current expectations at c.2%. Consumer spending is likely to remain volatile and inflationary cost pressures to continue into 2023, and therefore the Board expects adjusted profit before tax for the year ending 31 December 2023 to remain broadly in line with FY22. With £40m of net asset value, the Board intends to announce a maintained dividend in line with that paid in July 2022. Iofina 22p £42.2m (IOF.L) The explorer and producer of iodine and the manufacturer of specialty chemicals, announces that it has executed all agreements with a new brine supply partner to construct its latest IOsorb® iodine plant, IO#9, in Western Oklahoma. The construction is expected to take 6 months. Full payback is anticipated in less than 2 years with production of crystalline iodine targeted between 100 to 150 metric tonnes (MT) p.a. In Q3 of this year, Iofina produced 143.0 MT of crystalline iodine. Iofina is on track to produce 255-275 MT of crystalline iodine in the second half of this year. Plant Health Care 9.7p £29.8m (PHC.L) The provider of novel patent-protected biological products to global agriculture markets, has signed an agreement for EDAF Unipessoal LDA (EDAF) as the exclusive distributor in Portugal for its proprietary PREtec-containing fertilizer, PREzym™, for use in fruit, vegetable and cereals crop production. The commercial sales of PREzym is expected to start in H1 of 2023. The Company is on track to achieve revenue of $30m by 2025 through the launch of new products and continued organic business growth. Scancell Holdings 15.88p £129.4m (SCLP.L) The developer of novel immunotherapies for cancer and infectious disease, announces its audited results for the year ended 30 April 2022. The loss for the year was £2.1m (2021: loss £15.5m), due to £7m of non-cash gain on substantial modification of convertible loan notes as a result of a later maturity data. Cash at bank was £28.7m (2021: £41.1m). Convertible loan note outstanding was £7m and derivative liability was £10m at the end of the period. Scancell has initiated Cohort 2 of the Modi-1 clinical trial, the first candidate from its Moditope® platform, and anticipate reporting early safety and efficacy data from the ModiFY study in the next 12 months. In addition, it continues to progress SCOPE for SCIB1 and has completed recruitment in COVIDITY Phase 1 trial in South Africa. Tern 7.2p £26.9m (TERN.L) The company focused on value creation from Internet of Things (IoT) technology businesses, announces that Device Authority Limited, 53.8% owned by Tern, has completed a US$440k working capital funding in the form of unsecured convertible loan notes from Tern and other existing shareholders. Tern has subscribed for approximately US$303,401 of the convertible notes, representing approximately 69% of the total funding. Device Authority focuses on Identity and Access Management in automotive, medical device and industrial sectors. United Oil & Gas 1.73p £11.3m (UOG.L) The oil and gas company announces an update on the drilling of the ASH-4 development well in the Abu Sennan licence, onshore Egypt. United holds a 22% non-operating interest in the Abu Sennan licence, which is operated by Kuwait Energy Egypt. A net pay of 20 metres was interpreted in the targeted Alam El Bueib (AEB) reservoir. The well is expected to reach TD in the coming days, after which it will be tested and completed. It is then expected to be immediately brought onstream through the existing ASH facilities. On completion, the ST-1 rig is planned to move to the ASW-1X location to commence the drilling of this high-impact exploration well, targeting c. 8 mmbbls gross recoverable resources.
AGY IOF LIKE PHC SCLP EMH
Allergy Therapeutics has quantified the potential near-term revenue impact from the voluntary UK manufacturing pause. Whilst this is only expected to last around six weeks, FY23 revenues are expected to be 13-18% below current consensus expectations. This is unfortunately due to the interruption occurring during the peak production period, which is undoubtedly disappointing given management guidance of a return to near double-digit growth in FY23. This setback puts increasing pressure on the pipeline to deliver next year, with important readouts expected for both VLP Peanut and Grass MATA MPL; both are expected to initiate key clinical trials this year. Our valuation is lowered to £260.8m, or 38.4p/share, with the commercial business DCF reduced to £45.9m or 6.8p/share and our pipeline NPV unchanged.
Allergy Therapeutics expects to restart production at its UK manufacturing site on 14 November. While this is welcome news, the c.7-week voluntary shut-down falls in the peak production months in preparation for dosing patients ahead of the pollen season in the spring. Management has indicated that it expects revenues to be c.13-18% lower than FY 2023 market consensus of £80m (i.e. £10-14m). While its competitors will no doubt take advantage of this hiatus, we think it will be a FY 2023 event only and, to that extent, leave FY 2024 forecasts unchanged, helped by the prospect of a positive Phase III Grass MATAMPL trial outcome in H2 CY 2023 ensuring that doctors will want to use this product. We adjust FY 2023 forecasts accordingly, and reduce the target price to 50p, which also reflects the reduced financial flexibility.
17 - 21 October 2022
AGY BTRW BWY IHP MCRO N91 QLT ASC JE/ LIO EMG RHIM AJB BNZL DNLM GBG IPF JUP REL SDR SGRO STJ TPK ROO IHG HRGLF SEPJF
FY22 as expected, portfolio streamlined for FY23
The next 12-18 months will be key for Allergy Therapeutics, with the base European commercial business set to return to growth, whilst important pipeline readouts could propel the company closer to US market entry. In Europe, temporary headwinds impacted growth in Germany, Allergy Therapeutics’ largest market; these should abate, enabling a return to near double-digit revenue growth. Meanwhile, clinical trials for both VLP Peanut and Grass MATA MPL are set to initiate this year for data in summer and Q4 2023, respectively. These differentiated assets underpin future entry into the commercially important US market and could transform the company in the mid-term. Cash of £20.5m (FY21: £40.3m) has been boosted by £7m in equity and £10m in debt, enabling preparations to advance both of these pipeline programmes beyond planned trials. Our updated valuation is £327.7m, or 48.3p/share.
Allergy Therapeutics reported FY 2022 results £1.4m below our adjusted pre-tax loss forecast of £10.8m, driven by higher COGS and finance charge, with sales in line and net cash £1.0m higher than forecast. Clinical focus remains on the start of its pivotal Phase III Grass allergy trial (G306) in Q4 2022 and the Phase I VLP Peanut trial imminently, the outcomes from which in 2023 will determine the long-term shape and value of the business, for which we remain very optimistic. FY 2023 will see higher than forecast investment into the business, with opex limiting pre-R&D EBIT to low-single digit millions in 2023, and capex doubling to c.£7m. To that extent, and to fully fund the G306 extended safety database, the company has raised £7m (placing) and is issuing £10m of loan notes. With these higher investments, we reduce our FY23 adjusted pre-tax loss forecast by £8m to -£25.8m. We leave our target price unchanged; the weaker £/€ and rolling forward base year benefiting the SOTP calculation. This includes the rNPV for US market entry for Grass MATA MPL (15p), but still excludes the potential rNPV of VLP Peanut, which could be worth c.13-17p.
Trinity Delta view: Revenues continue to be impacted by the planned portfolio streamlining, masking underlying performance, albeit these effects should wash out in FY23 with a return to near double-digit growth anticipated. Tight cost control continues, with phasing affecting various line items, for Net Income to be in-line with consensus. Importantly, the two key pipeline programmes, VLP Peanut and Grass MATA MPL, remain on-track to initiate trials this year. Cash together with some debt should be sufficient to reach key data read-outs for both next year. Our valuation remains £341.6m (53.1p per share).
The company released a trading update for the full year to 30 June 2022. Revenues are reported to be £72.8m (FC £75.8m). Despite this, the net loss is expected to be broadly in line with market consensus, helped by lower R&D expenses and tight control over operating expenses. Cash at 30 June was £20.5m (FC £24.5m), partly due to R&D pre-payments as well as lower revenues. Both the pivotal Phase III Grass MATAMPL trial and Phase I VLP Peanut allergy vaccine remain on track to start recruitment in H2 2022. We make minor changes to FY 2022 net income/EPS and reduce FY 2023 and 2024 revenues and profit by c.£4m and £6m, respectively. Consequently, we reduce our target price to 60p (vs. 65p) to reflect lower FY 2023 revenue forecasts, but consider the investment rationale for buying the stock to remain strong, with substantial potential upside as key value inflection points are reached over the next 18 months. This includes the rNPV for US market entry for Grass MATA MPL (15p), but still excludes the potential the rNPV of VLP Peanut, which could be worth c.13-17p per share.
Allergy Therapeutics has announced a trading update for the year ended 30 June 2022, with revenues for the year expected to be £72.8m (2021: £84.3m) – this is lighter than our estimate of £78.4m and represents a 14% reduction on a reported basis (down 9% on a constant currency basis). The impact of COVID19, especially in Germany, alongside Allergy’s streamlining strategy and factory upgrades – which led to delays in shipping – are largely responsible for the shortfall. While this is disappointing, we continue to regard pipeline – notably Grass MATA MPL and VLP Peanut – as key drivers for future value. Both clinical programmes are due in 2022, with the company continuing to expect topline data from the Phase I PROTECT peanut trial in H1 2023. Cash at year end was £20.5m (previous PGe £25.7m) while Allergy continues to expect to be able to fully fund, with existing cash resources and some additional debt, the upcoming pivotal Phase III trial for Grass MATA MPL and the Phase I PROTECT trial for VLP Peanut. We move our target price from 77p to 71p on the basis of our prospective sales multiple downgrade, while reiterating our Buy recommendation.
Allergy Therapeutics continues to execute on its clearly defined three pillar strategy for growth in both the near- and mid-to-longer term. In Europe, interim results demonstrate continued robust performance. Key pipeline programmes Grass MATA MPL and VLP Peanut have also made significant progress, with both set to start major clinical trials this year. These high value and well differentiated assets underpin future entry into the commercially important US market. Cash of £41m, plus the £10m credit facility, should be sufficient to fund the planned Grass MATA MPL Phase III trial and VLP Peanut Phase I study, and so reach material value inflection points in 2023. Our £341.6m (53.1p per share) valuation suggests the pipeline value is under appreciated.
Allergy Therapeutics reported six-month results to 31 December, which were in line with the trading update on 13 January and reflect the previously articulated strategy to focus on its core brands (Pollinex, Pollinex Quattro, Acarovac and Venomil) and technology platforms (MATA MPL and VLP), resulting in the discontinuation of non-core products, including TyroMILBE and Orallvac in Germany. Revenues fell 5% (CER) to £48.7m although were +4% on a like-for-like basis; with pre-R&D EBIT down 38% to £12.8m, reflecting the gross margin de-leverage. Adjusted pre-tax profits fell 52% to £7.6m (vs. £15.7m). After the pull-back in the broader market and the 34% decline YTD in the AGY stock price we consider the shares to offer considerable upside, supported by recent Grass MATA MPL data, which improves on data released in October and provides greater support for the broader MATA MPL franchise (including tree and ragweed pollen). We are making no changes to forecasts, which were reviewed at the time of the January trading update. Given the balance sheet (£48.0m cash), we believe the risk/reward profile is highly attractive and reiterate our 65p target price.
Allergy Therapeutics’ interim results follow the company’s January trading update, which flagged half year revenues of £48.7m (H1 2021: £54.0m) and the strong balance sheet cash position of £41.4m (30 June 2021: £40.3m). While the company manages its portfolio streamlining programme and has navigated COVID headwinds during the period, the positioning remains strong with full-year operating profit (pre-R&D) ‘expected to be in line with consensus forecasts’. Meanwhile, the pipeline value drivers in seasonal allergy (Grass MATA MPL) and the VLP Peanut programme remain on track, with both entering important clinical programmes during 2022. We refer investors to our note of 13 January 2022 (‘Trading update, resilience and opportunity’) with regards our most recent updates to estimates and reiterate our Buy recommendation.
Today’s announcement of five poster presentations at the 2022 American Academy of Allergy Asthma and Immunology (AAAAI) Annual Meeting further emphasise Allergy Therapeutics’ position as a leader in its field. Data presented cover its two lead immunotherapy programmes – Grass MATA MPL and VLP Peanut – with both programmes expected to make significant clinical progress during the course of 2022. We note that the data from the Grass MATA MPL G309 study is even better than originally presented, with a near-40% reduction in combined symptom and medication score compared with placebo and with supportive post-hoc analyses of the earlier Phase II work. Meanwhile, we continue to expect the company to start the VLP Peanut Phase I PROTECT trial in H1 2022, with topline data from this first-in-human trial expected in H1 2023. Interims are due 3 March 2022 and we reiterate our Buy recommendation.
The US FDA’s acceptance, announced today, of Allergy Therapeutics’ IND application for the company’s novel peanut allergy vaccine VLP Peanut paves the way for the start of the Phase I PROTECT trial in H1 2022, with topline data from first-in-human trial expected in H1 2023. This is an important milestone for the programme, while peanut allergy remains a serious and significant unmet medical need within the food allergy arena. We reiterate our Buy recommendation.
Revenue warning and R&D update
The six-month trading update to 31 December reflects the discontinuation of non-core products, ongoing COVID-19-related headwinds, principally in Germany and Italy, exchange-rate headwinds (-5%) and product phasing issues, with revenues falling 10% to £48.7m. Underlying like-for-like growth, however, was 3% at constant exchange rates (CER). Period-end cash was £41.4m, which implied a c.3% increase (+£1.m) in underlying cashflows in the period. We have reduced revenue forecasts by 9% in FY 2022 to £77.5m to reflect these factors and bring our pre-R&D EBIT into line with market consensus (c.£5.6m), given management comments that cost savings in the second half should offset the sales shortfall. Confirmation that an IND application has been submitted to the FDA for the VLP Peanut Phase I trial and that Phase I headline results should be brought forward to H1 2023 (although we expect cohort data during 2022), due to trial design changes, are positives. We leave our target price of 65p unchanged, which includes a rNPV for Grass MATA MPL of 15p per share. It still excludes the rNPV of VLP Peanut which could be as high as c.£85-110m (13-17p per share) using an industry-standard probability (c.10%) of reaching the market and the acquisition of Aimmune (c.$2.6bn) by Nestlé as a proxy for valuing a peanut allergy vaccine.
Allergy Therapeutics’ first half trading update gives us a variety of elements to consider, given the excellent progress made in US regulatory for VLP Peanut – potentially bringing forward the timeframe for Phase I PROTECT readout in adult patients due to a revised protocol – and continuing progress on Grass MATA MPL Phase III, on track to commence in Q3 2022. Meanwhile, a combination of the planned product streamlining, product phasing and Germany/Italy COVID is expected to see a decline in FY22E revenues but with confidence of achieving market expectations for pre-R&D operating profit. The ability to still broadly deliver at the bottom line indicates to us good resilience, and flexible business infrastructure, in combination with the support of the strong cash position, £41.4m at period end. We apply changes to our numbers to reflect the trading dynamic but continue to consider the pipeline progress as where, ultimately, the real opportunity lies. We maintain our Buy recommendation and look to interims on 3 March 2022 for further detail.
Allergy Therapeutics continues to trade solidly in a challenging environment. Its H122 trading statement confirmed six-month revenues to end-December 2021 of £48.7m (H121: £54.0m, down 5% on CER) reflecting commercial portfolio streamlining, phasing, and German headwinds. FY22 revenue guidance is for an upper single digit percentage decline on FY21, with pre-R&D operating profit in line with current consensus. A strong cash balance of £41.4m, when coupled with modest additional debt, will fund the ongoing Grass MATA MPL pivotal Phase III programme and Phase I trials for VLP Peanut. Resilient performance of the European allergy business and continued progress of the grass allergy programme underpin medium term prospects. Ahead of H122 results, we maintain our valuation of £350.7m (54.7p/share).
23 - 26 November 2021
AGY DPLM POLR AXS AO/ CPG BOY CWK CRH DVO HLCL KGH PETS PZC RCH TEP TTG CLIN CVSG GNS ITRK RSW ROR FORT HILS MOTR MTC BTVCF DELRF
The allergy immunotherapy has announced positive results from the exploratory G309 field study of the short course treatment for grass allergies. Two dosing regimens of six injections over 6 and 14 weeks led to a 29% and 37% improvement versus placebo on the Combined Symptom Medication Score over t
Positive headline results announcement, showing a statistically significant and clinically meaningful difference between Grass MATA MPL and placebo in hayfever patients in the exploratory field study (G309), is considered a major de-risking event. Not only does it increase the probability of successfully completing the pivotal Phase III study (G306) in the US and EU, but it underpins the broader MATA MPL platform, which includes tree and ragweed pollen, and increases the likelihood of completing the TAV registration process in Europe. We increase our target price to 65p.
This morning, Allergy has announced positive top-line results from the G309 exploratory field trial to evaluate efficacy and safety of its Grass MATA MPL programme. We remind investors that we were waiting for an update in the autumn, and today’s news comes in line with that timing. Moreover, the primary endpoint Combined Symptom Medication Score (CSMS) was achieved with clinically relevant improvement across both active treatment groups compared with placebo, with a statistically significant reduction in CSMS of 29.1% (6 weeks treatment) and 36.8% (14 weeks) vs placebo respectively. The analysis of secondary endpoints including quality of life and biomarkers were also consistent with the primary endpoint results. We view today’s news as significant in terms of advancing the company’s Grass programme, with the G306 Phase III pivotal trial on track for commencement in H2 2022 in US and Europe. We upgrade our SOTP target price to 77p (70p), noting that we have yet to include Peanut allergy within our valuation methodology. Reiterate Buy.
▪ Allergy Therapeutics has reported highly encouraging top line data from its G309 exploratory field trial of Grass MATA MPL. Both treatment arms demonstrated statistically significant improvement over placebo on the primary endpoint, the combined symptom and medication score (CSMS). The six-week arm showed a 29.1% improvement (p=0.0367), with this rising to 36.8% (p=0.0088) in the 14-week arm. These represent a significant reduction in both daily symptoms and the use of relief medication. Both dosing regimens were shown to be safe and well tolerated. Additionally, European and US study centre data were comparable. Analysis of secondary endpoints, including quality of life measures and allergy biomarkers, is yet to be completed. Full G309 results will be presented at a future conference. ▪ G309 is an innovative double-blind, placebo controlled, randomised study that evaluated the efficacy and safety of an optimized Phase III dose of 27,600 SU Grass MATA MPL. Two short courses of six injections with treatment durations of six and 14 weeks were tested. The trial ran for one year, over the 2020/21 allergy season, and recruited c 150 patients over 12 sites in Germany and the US. ▪ The G309 results will help inform and optimise the design of the pivotal Phase III study (G306), which is the key step for FDA filing and potential approval in the US. G306 will also be run in Europe and the US, and is planned to start in H222, capturing the 2022/23 allergy season. It is expected to involve 900-1,200 patients and more than 100 trial sites. ▪ The Grass MATA MPL development programme is a key element in Allergy Therapeutics medium-term strategy. These trials, assuming the positive G309 results are replicated in G306, are set to demonstrate the clinical benefits of Pollinex Quattro (PQ) ultra-short courses. In Europe, the PQ range is currently only available on a “named patient” basis; regulatory approval would remove marketing restrictions allowing promotion of the clinical benefits to the medical community. In the US, an FDA approval would make it the first short course, subcutaneous and aluminium-free allergy immunotherapy available in the US.
The allergy immunotherapy company has reported 6% CER increase in revenues to £84.3m (NSe £84m) at 74% gross margins and delivered a 19% increase in pre-R&D operating profit to £16.9m. The company invested £12.9m in R&D in FY21 and retains £36.5m in net cash, sufficient to fund the pivotal
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At 119p they are trading at a justified 10% premium to NAV offering a dividend yield of 5% which looks attractive given the quality of its tenants, the inflation-protected nature of the income and the longevity of its leases (WAULT of 15 years). We therefore retain our Buy rating. Read More... Arecor Therapeutics : Significant progress in 2021; upgrading target price Analysts - Dr Julie Simmonds +44 (0)207 886 2743 & Dr Mike Mitchell +44 (0)207 886 2761 Arecor interim results highlight the substantial progress made during 2021. The company has transformed, with highly encouraging clinical results increasing the value of its portfolio, new pharmaceutical partnerships bringing the potential to extend its pipeline and the IPO giving the company funding to support development of the whole; potentially through to profitability. We reiterate our BUY recommendation and raise our target price to 486p (previously 336p). 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Today Allergy reports a record pre-R&D operating profit of £16.9m (FY20: £14.2m) – an increase of 19% year-on-year. Notably, given the guidance in today’s statement, this beat has not been achieved with any additional shift of costs into 2022 from 2021 versus the earlier trading updates, and we maintain our FY22E sales and earnings estimates unchanged. The real value drivers, in our view, are the advancing portfolio programmes, of which investors have heard much in recent weeks, including VLP Peanut. We revisit these today and remind investors that the Grass MATA MPL G309 exploratory field study results continue to be expected this autumn. We consider there to be significant upside from current levels, despite having yet to include VLP Peanut within our valuation, and we reiterate our Buy recommendation. Read More... Hansard Global : FY21 results: progress made ahead of Japan launch Analysts - Ming Zhu +44 (0)20 7886 2738 & Barrie Cornes +44 (0)20 7886 2758 Hansard has reported its FY21 results (year ended 30 June 2021). Overall, we believe that Hansard has continued to improve its earnings despite the wider market volatility during Covid. IFRS PBT of £5.1m (+8.5% y/y) and the Group has declared a flat final dividend of 2.65p (4.45p for FY21). The Group remains committed to launching its Japan proposition, but timing depends on the Covid-19 restrictions being lifted in Japan. It has a strong intention to go to the market before the end of 2021. It continues to upgrade its IT systems and it is ready for new business from Japan and cost savings will follow after the implementation of the new systems. We reiterate our Buy rating with unchanged target price of 65p, based on 14x FY22E PE. The stock currently trades on an 8% dividend yield. Read More... Gemfields Group Ltd : Interim Results: Like a Phoenix from the flames Analyst - Kieron Hodgson +44 (0)20 7886 2773 Gemfields interim results demonstrate just how much it has recovered from the unprecedented disruption imposed on it, and the coloured gemstone sector, from the COVID-19 pandemic in 2020. Driven by exceptional demand for Gemstones, the restart of auctions in the period saw the company achieve prices materially ahead of both Panmure Gordon and company expectations. As mining operations normalise and auction schedules are confirmed for the remainder of the year and into FY2022, we see increasingly positive outcomes for the company and investors alike. Read More... Urban Logistics REIT : Acquisition update Analysts - Miranda Cockburn +44 (0)20 7886 2778 & Charlotte Adolpho +44 (0)20 7886 2749 Following the equity raise in the summer, Urban Logistics has announced today £88m of acquisitions (a mixture of six ‘off market’ transactions comprising income producing assets and forward funding commitments). The blended NIY of 5.4% is lower than the pipeline’s expected 6.1% NIY due to the more expensive properties being acquired first and some substitutions. However, once the pipeline as a whole is purchased (the company has c.£50m of firepower left) the blended NIY is expected to rise to c.6% overall. The shares are up 24% year-to-date and are currently trading on an 11% premium to NAV and offer a 4.3% dividend yield. Compared with its peers these ratings do not look demanding and given the attractive growth prospects we retain our Buy rating. Read More...
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Allergy Therapeutics reported FY 2021 results that were 95% (+£2.1m) ahead of adjusted pre-tax profit expectations, driven by lower than forecast overhead costs. This underpinned 20% growth in pre-R&D EBIT to £16.9m on 6% CER revenue growth. Year-end net cash was £36.9m, providing the company with the financial resources to complete both its Grass MATA MPL Phase III trial and complete the VLP Peanut Phase I trial. The readout of the exploratory Phase III (G309) Grass MATA MPL study in the autumn should be the next meaningful news flow, which will determine the final design of the pivotal study. We raise our target price to 50p, which is underpinned by the current commercial operations with further potential upside for Grass MATA MPL in the US (c.12-17p) and VLP Peanut (c.5-10p). We remain excited about the VLP opportunity, awaiting the Phase I data through 2022/23 before formally including it in the valuation, but in time we believe that this product could be worth substantially more than the current market capitalisation.
Allergy Therapeutics had previously flagged headline FY21 revenues and cash (£84.3m and £40.3m respectively) in earlier trading updates, and while we had also already upgraded earnings to reflect lower costs during 2021, the company has still beaten our estimates at the bottom line. Today Allergy reports a record pre-R&D operating profit of £16.9m (FY20: £14.2m) – an increase of 19% year-on-year. Notably, given the guidance in today’s statement, this beat has not been achieved with any additional shift of costs into 2022 from 2021 versus the earlier trading updates, and we maintain our FY22E sales and earnings estimates unchanged. The real value drivers, in our view, are the advancing portfolio programmes, of which investors have heard much in recent weeks, including VLP Peanut. We revisit these today and remind investors that the Grass MATA MPL G309 exploratory field study results continue to be expected this autumn. We consider there to be significant upside from current levels, despite having yet to include VLP Peanut within our valuation, and we reiterate our Buy recommendation.
Allergy Therapeutics has reported solid FY21 trading, with revenues up 8% (6% CER) to £84.3m (FY20: £78.2m). Pre-R&D operating profit rose 19% to £16.9m (FY20: £14.2m) given lower promotional and marketing spend due to COVID-19 restrictions, coupled with tight cost control. R&D investment increased from £9.0m to £12.9m to support the two key programmes: the G309 Grass MATA MPL exploratory field study and the VLP Peanut ex vivo biomarker study. Cash of £40.3m (FY20: £37.0m) is sufficient to fund the two Grass MATA MPL Phase III trials and the VLP Peanut Phase I trial. These two development programmes could transform the company’s mediumterm prospects, underpinning entry into the commercially important US market. Our updated valuation is £350.7m, or 54.7p per share.
Allergy Therapeutics’ VLP Peanut vaccine ex-vivo study has successfully met all primary and secondary endpoints. These confirm the safety is as hoped, with clear indications of a material shift from a Th2-dominated (allergic) response to a Th1- dominated (tolerant) response in a dose-dependent manner. These results, together with prior preclinical data, will support an IND application with the FDA. A Phase I trial is expected to start in Q122, with results likely before end-2023. A successful clinical outcome would transform the lives of peanut allergy sufferers and be equally transformational for the company. Medium term prospects remain underpinned by the resilient performance of the European allergy business and the continued progress of the Grass MATA MPL programme, where results from the G309 exploratory field study are due before end-2021. Our valuation is £344.5m,or 53.8p per share.
PRS REIT : NAV/trading and pipeline update Analyst - Miranda Cockburn +44 (0)20 7886 2778 PRS REIT has reported today a June NAV of 99p showing growth of 4% over the year together with a positive trading update for the two months to the end of August, with 4,227 homes now complete, the company being on course to deliver its initial target of a portfolio of c.5,200 homes (ERV of c.£50m pa) by the end of this year/early next and full dividend cover on an annualised basis by the end of 2021. Looking forward management has identified six further sites with the potential for 670 new homes (total gross development cost c.£102.5m and ERV of c.£6.5m pa implying a yield on cost of c.6.3%) and the Board is exploring the most suitable way of raising additional capital. The shares have performed well year-to-date up 44%, boosted by the move to the main market and ongoing progress with development completions. As a result, they are trading on a 12% premium to the reported NAV (but remember the investment value of the portfolio remains at a discount of c.8% to vacant possession value) and the dividend yield is now 3.6%. With continued strong demand for suburban rental property and increasing investor interest in the single-family BTR sub-sector, we retain our Buy rating and update our 12-month target price to 120p. Read More... Allergy Therapeutics : VLP Peanut – KOL Webinar Analysts - Dr Mike Mitchell +44 (0)207 886 2761 & Dr Julie Simmonds +44 (0)207 886 2743 Last week’s KOL (Key Opinion Leader) webinar on the company’s VLP Peanut vaccine programme, ‘VLP Peanut; a next generation peanut allergy immunotherapy’ offered investors a further view on the strategy, technology, preclinical and biomarker work in support of VLP Peanut as it advances towards clinical phase H1 next year. Our takeaway is that there are strong indications that the strategy pursued by Allergy is one demonstrating a potentially effective disease modifying approach, with a compelling safety profile, and with preclinical work that offers a robust working mechanism to explain cross protection. We look to full year results on 23 September as the next scheduled update from the company and reiterate our Buy recommendation. Read More... Arecor Therapeutics : Positive headline results for AT278, increasing target price Analysts - Dr Julie Simmonds +44 (0)207 886 2743 & Dr Mike Mitchell +44 (0)207 886 2761 Arecor has announced positive headline results from the Phase I clinical trial of AT278, its ultra-concentrated, rapid acting insulin for treatment of diabetes. The trial met all of its primary and secondary endpoints. We await publication of the full data at an international diabetes conference. Although only a Phase 1, we believe this result gives a clear indication that the product has a high chance of a success. We reiterate our BUY recommendation and increase our target price to 336p (previously 297p) Read More... Direct Line Group : Pricing outlook and benefits from transformation Analysts - Ming Zhu +44 (0)20 7886 2738 & Barrie Cornes +44 (0)20 7886 2758 We take a slightly more optimistic view on UK motor insurance premium pricing in the near term, reflecting the unwind of Covid-19 discounts. This could be partially offset by Whiplash reform and remaining uncertainty from the FCA pricing review into 2022. We continue to believe DLG stands out in a competitive market. It benefits from the largest insurer-owned repair network. H1 2021 showed the early signs of benefits from its digital transformation programme and more benefits are expected to come through in the next 18 months. Overall DLG is making itself more competitive while maintaining its underwriting discipline. DLG has shown that it does not need motor premium pricing to increase assertively to grow. We reiterate our Buy rating with unchanged target price of 360p. Read More... Finsbury Food Group : Increasing forecasts despite inflationary headwinds Analyst - Matthew Webb +44 (0)20 7886 2756 FIF’s FY21 results are in line with expectations following a strong H2 performance. FIF faces significant headwinds from inflation and labour shortages in FY22, but is trading strongly, continues to make efficiency gains, and has a strong track record of passing on rising costs. We therefore increase our FY22 and FY23 PBT forecasts by 6%. Our target price increases to 121p (from 112p) and we remain Buyers. Read More... Babcock : Positive weekend press on Aukus read across Analyst - Robert Plant +44 (0)20 7886 2784 There was positive weekend press on the implications for Babcock from the US/UK/Australia defence pact knows as Aukus. We think that Aukus could be a material development for the company’s submarine business and for its further expansion into international defence. Read More...
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Last week’s KOL (Key Opinion Leader) webinar on the company’s VLP Peanut vaccine programme, ‘VLP Peanut; a next generation peanut allergy immunotherapy’ offered investors a further view on the strategy, technology, preclinical and biomarker work in support of VLP Peanut as it advances towards clinical phase H1 next year. Our takeaway is that there are strong indications that the strategy pursued by Allergy is one demonstrating a potentially effective disease modifying approach, with a compelling safety profile, and with preclinical work that offers a robust working mechanism to explain cross protection. We look to full year results on 23 September as the next scheduled update from the company and reiterate our Buy recommendation.
This morning, the announcement of secondary endpoints from the VLP 001 Peanut ex-vivo biomarker study adds to previously announced results, with data supporting a beneficial efficacy profile, and demonstrating a reduced ability to trigger immune cells associated with allergic reactions. Today’s commentary further complements the primary outcome of hypoallergic potential of VLP Peanut and adds to confidence in upcoming VLP Peanut first in-human Phase I PROTECT study, due to commence Q1 2022. Meanwhile, we remind investors of the KOL webinar on VLP Peanut scheduled for 17 September and reiterate our Buy recommendation.
Peanut allergy data shows promise
Successful primary results from the ex-vivo biomarker study for Allergy’s peanut allergy vaccine candidate, VLP Peanut, help to advance the programme towards the clinic, as they confirm the candidate’s hypoallergic potential. We view this as ‘another piece of the jigsaw’ of the VLP Peanut development programme slotting firmly into place. Allergy Therapeutics’ first in-human Phase I study remains on track for Q1 2022, offering another step forward for this potential short-course peanut allergy vaccine candidate, representing a significant opportunity in the $8bn worldwide food allergy market. Today’s news strengthens the framework for the company’s IND (Investigational New Drug) application to be submitted to the US FDA in late 2021 and, given continued progress also reflected in the company’s recent trading update, we reiterate our Buy recommendation.
▪ The VLP-Peanut 001 ex vivo biomarker study carried out in conjunction with Imperial College London has reported positive results. This study, focused on evaluating safety, confirmed both the hypoallergenicity of this first VLP (virus-like particle) based peanut allergy vaccine candidate and the proposed design of the Phase I PROTECT first-in-human trial (outlined in our July 2021 Update), on track to initiate in Q122. ▪ Human blood samples from peanut allergic individuals were used to evaluate an extensive range of functional and molecular biomarkers and assess the potential for an allergic reaction following dosing with VLP Peanut. The study achieved its primary outcome, confirming VLP Peanut was hypoallergic: basophil activation and histamine release post challenge was 24-fold lower vs with recombinant peanut extract. Analysis of secondary endpoints is yet to be completed. ▪ This new data will be included in the VLP Peanut IND application, which will be submitted to the FDA in late-2021, supplement the existing preclinical research package that demonstrated sustained immunological protection following peanut exposure after one single vaccination. An extensive multiple dose toxicology study with the VLP Peanut vaccine candidate has also completed, using the maximum subcutaneous doses expected to be administered in the PROTECT Phase I trial. ▪ The VLP Peanut vaccine candidate is a novel immunogenic, protective, and non-reactogenic short-course subcutaneous vaccine based on immunologically optimized Cucumber Mosaic Virus-derived VLPs (CuMVTT) that display the major peanut allergen (Ara h 2) on its surface. Further information will be presented by Allergy Therapeutics on its VLP Peanut vaccine candidate and VLP technology at a key opinion leader event and investor day in September 2021.
Allergy Therapeutics FY21 performance is far better than we might have expected given the disruptions to European medical services over the last 18 months. We continue to believe the value of the core allergy immunotherapy business is under-appreciated, with significant additional upside if R&D
Today's full-year trading update follows swiftly on the heels of last month's pre-close commentary, with revenues expected to be £84.3m, versus our prior PGe £83.3m estimate. This represents year-on-year reported growth of +8% (+6% constant currency), helped in part by the strong Euro. As highlighted last month, expenses for 2021 are anticipated to be significantly lower than our pre-June expectations due to COVID-19, while a record cash position of £40.3m (previous PGe £38.2m, 2020: £37.0m) continues to strongly underpin full funding of the planned Grass MATA MPL pivotal Phase III field studies and the Phase I Peanut programme. Timing of the grass programme remains on track with exploratory field study treatment phase complete and read-out expected in H2 2021, and results from the VLP Peanut ex-vivo biomarker study are expected Q3 2021. With our investment thesis continuing to be reinforced by operational delivery, we reiterate our Buy recommendation.
Allergy Therapeutics confirmed strong FY21 trading, ahead of market expectations, with revenues up 8% (6% CER) to £84.3m (FY20 £78.2m). Lower spend due to COVID19 restrictions on travel and conferences, coupled with phasing of planned R&D, means net income will be higher than our prior £6.2m forecast loss. Cash is at a record £40.3m vs £37.0m last year. Robust performance emphasises the resilience of the underlying business, but two development programmes are set to potentially transform medium-term prospects. Key value inflection points are expected over the coming months: the ex vivo peanut allergy biomarker study for the VLP-vaccine will read out in Q3, and data from the G309 Grass MATA MPL exploratory field study is due in H2. Our current valuation is £344.5m,or 53.8p per share.
Allergy Therapeutics’ recent pre-close trading update for the year to 30 June 2021, indicated that statutory operating profit would be substantially higher than market consensus. Higher revenues, helped by a more favourable £/€ rate and lower operating expenses despite additional compliance and Brexit-related costs, are now expected to result in an adjusted pre-tax profit of £0.8m, some c.£5m higher than previously forecast. Whilst much of this performance relates to phasing of costs, and a stronger year-end Euro is expected to curtail reported revenue growth in 2022, the underlying outlook remains positive. Cash at 30 June 2021 is expected to be at least £37m (finnCap £31m) and sufficient to complete the pivotal Phase III Grass MATAMPL and Phase I peanut allergy vaccine studies. We reiterate our 45p target price, pointing out the substantial and widening discount to its nearest peer (ALK-Abello at F2 7.6x EV/Sales). This target also excludes the risk-adjusted value for US market entry for Grass MATA MPL (12-17p) or its early-stage pipeline, including VLP Peanut allergy vaccine (c.5-10p).
Allergy's pre-close trading update today indicates earnings for FY21E to be ahead of market expectations, a strong performance against challenging COVID-related market conditions. Cost savings have helped, while some commercial projects and R&D expenditure moving from FY21E to FY22E see us now anticipating pre-tax profitability in FY21E. This shift of costs naturally means a deeper dig on losses in 2022 - alongside some portfolio streamlining on non-differentiated products which suggests lower top-line growth in FY22E - while the long-term ambitions remain supported by the strength of the balance sheet; we presently estimate FY21E year-end cash circa £38m. Continued development progress on Grass MATA MPL and the opportunity in peanut allergy continue to offer significant upside potential. We remain Buyers.
▪ Allergy Therapeutics’ pre-close trading update indicates FY21 results (to 30 June 2021) will be ahead of market expectations. Revenues are boosted by the strong Euro rate (most sales are Euro-denominated), while expenses are lower due to COVID-19 restrictions on travel and scientific conference attendance (with some carry over into FY22). Additionally, some R&D investment originally expected to be incurred during FY21 will now be phased into FY22. This suggests that Allergy Therapeutics’ endJune 2021 cash position will be stronger than our forecast of £30m. ▪ Looking to FY22, the revenue growth (at CER) is expected to be at “low single digit levels”. This reflects a continuing impact of COVID-19 on patient consultations in certain markets, as well as the planned deemphasising of various older, non-core product lines as the focus remains on the newer SCIT (short-course subcutaneous therapy) and novel allergy treatments. Underlying expenses are expected to return to pre-COVID levels, which coupled with continuing investment in R&D, suggests a lower level of reported earnings. ▪ The next 12-24 months represent an important period for Allergy Therapeutics. Top-line data from the G309 exploratory field study of Grass MATA MPL is anticipated in calendar H221, which will inform design of the G306 pivotal grass trial (scheduled to start autumn 2022). The ongoing P001 ex vivo peanut allergy biomarker study should read out in the summer, with potential for IND submission by year-end. Management confirms it expects to be able to fully fund the pivotal Phase III Grass MATA MPL programme and the Phase I VLP peanut study with existing resources supplemented by a small amount of additional debt. ▪ The company intends to issue its post year end trading update on 14 July 2021, with preliminary FY21 results due to be announced on 23 September 2021.
Allergy Therapeutics has announced the completion of the treatment period for all patients in the G309 exploratory field study of Grass MATA MPL. This has been achieved despite the myriad COVID-19 restrictions and challenges in performing such a study in both Europe and the US. The lack of delay means the data readout remains on track for H221.
Summary: In this report we outline the investment case for three companies that we believe are primed for growth: Diurnal, Kromek and Oxford Biodynamics. We also include the outlook for the AIM healthcare sector and overall healthcare sector, industry and capital market indicators, key sector news, recent research highlights and a profile of all the companies covered by the finnCap Life Sciences team.
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Hemogenyx Pharmaceuticals (HEMO.L): HEMO-CAR-T Update Allergy Therapeutics (AGY.L): Interim results
Allergy Therapeutics plc HemoGenyx Pharmaceuticals Plc
Allergy Therapeutics delivered record interim revenue of £54.0m (+7%, +5% CER) and operating profit pre-R&D of £20.5m during financial H121, emphasising the resilience of its European commercial business despite COVID-19 impacts and the spectre of Brexit. Operationally, the company is also progressing steadily with its pipeline. The G309 exploratory Grass MATA MPL Phase III study is fully enrolled, with most subjects treated ahead of the pollen season; data, anticipated in the autumn, are expected to inform design of the G306 pivotal grass trial (scheduled to start autumn 2022). The ongoing P001 ex vivo peanut allergy biomarker study should read out in the spring, ahead of an FDA pre-IND meeting in calendar H121 and potential IND submission by year end. Allergy Therapeutics’ £48.3m cash balance (at end-December 2020) will fund both the Grass MATA MPL Phase III trial programme and the peanut allergy Phase I trial, with data from these representing material value-inflection points. We upgrade our valuation to £344.5m, equivalent to 53.8p per share.
As previously guided, sales increased 5% CER to £54m in challenging conditions in the second half of 2020 (on/off lockdowns, and continued restrictions in health services). Performance was especially robust in Northern Europe, where standalone clinics were less impacted by COVID-19 restrictions. Tr
Allergy Therapeutics reported six-month results to 31 December highlighting the underlying momentum within the business and the operational leverage afforded by its high-margin products. Revenues increased 5% (CER) to £54.0m with pre-R&D EBIT up 19% to £20.5m, reflecting the gross margin leverage and a 1% increase in underlying overhead. Adjusted pre-tax profits (ex-£3.2m litigation payment) rose 21% to £15.7m. We leave forecasts unchanged, which assumes a substantial uplift in H2 costs (+£6.2m) compared with H1 (+£0.3m), and therefore potentially providing some upside to our forecasts. Given the balance sheet (£48.3m cash), which is sufficient to fully fund its core R&D projects, we believe the risk/reward profile is highly attractive and reiterate our 45p target price, pointing out the substantial and unwarranted discount to its nearest peer (ALK-abello - 6.9x EV/Sales). This target also excludes the value of US market entry via the Grass MATA MPL vaccine (c.12-17p) or VLP Peanut allergy vaccine (c.5-10p).
Allergy Therapeutics’ European commercial business remains resilient despite COVID-19 impacts. The H121 trading statement indicates sales growth of 7% (+5% CER), while steady pipeline progress is also being made. Recruitment and treatment in the G309 Grass MATA MPL Phase III study is on track, with post period key events including initiation of the P001 ex vivo peanut allergy biomarker study and publication of positive challenge chamber results for ImmunoBON in a peer reviewed journal. This bodes well for news flow delivery over the rest of calendar 2021. G309 results in the autumn are expected to inform design of the G306 pivotal grass trial; P001 data in the spring will support IND submission; and ImmunoBON is set to launch in Germany later this month. A record cash balance of £48m (at end-December 2020) covers nearterm requirements taking the company through to material value-inflection points. Ahead of H121 results on March 3, we maintain our £325m (51p/share) valuation.
The allergy vaccine company has reported a reasonably strong H1 with revenues up 5% on constant currency to £54m. Performance was especially strong in Germany, Austria, Switzerland and the Netherlands. This is impressive given the disruption to European health services caused by the pandemic and lo
The six-month trading update to 31 December demonstrates solid underlying growth, with revenues rising 7% to £54.0m, or c.5% at constant exchange rates (CER), despite ongoing COVID-19 restrictions. Period-end cash was £48.3m, which implied a c.30% increase (+£11.3m) in underlying cashflows in the period. With relevant and potentially significant commercial and regulatory newsflow through 2021, we expect the shares to perform well. We leave our forecasts unchanged for FY 2021 at this point and reiterate our 45p target price, pointing out the substantial and unwarranted discount to its nearest peer (ALK-abello - 6.1x EV/Sales). This target also excludes the value for US market entry for Grass MATA MPL or its early-stage pipeline, including VLP Peanut allergy vaccine.
Allergy Therapeutics has initiated an ex vivo biomarker study with Imperial College London for its novel VLP-based peanut allergy vaccine candidate. The information generated from this study will be used to support clinical development of the peanut vaccine programme and will establish the starting dose of the first-in-human Phase I study. The IND application will be filed with the FDA in 2021, with the Phase I trial also planned to start this year.
The COVID-19 diagnostics sector has been at the forefront of international attention in 2020 as the primary weapon to fight the pandemic. The recent promising news on vaccines has prompted fears over the sustainability of this market; however, we believe these fears are unwarranted. We believe the market has yet to peak and will do so in 2021, but will remain strong into 2022 and beyond. Overall, it is likely that COVID-19 will be a part of our lives for years to come and may even be a perpetual presence – and as long as this remains the case, COVID-19 testing will be an important tool for keeping the disease in check and avoiding outbreaks.
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Allergy Therapeutics (AGY.L): Initiation of field trial | Sensyne Health (SENS.L): Research agreement with Milton Keynes University Hospital
Allergy Therapeutics plc Sensyne Health Plc
Allergy Therapeutics has announced the screening of the first patient in the G309 exploratory field study of Grass MATA MPL, a short course, aluminium-free, allergen-specific, subcutaneous immunotherapy (SCIT), in seasonal allergic rhinitis and/or rhinoconjunctivitis induced by grass pollen. G309 is a double-blind, placebo controlled, randomised study designed to evaluate the efficacy and safety of an optimized Phase III dose of 27,600 SU Grass MATA MPL. The trial will run for one year, capturing the 2020/21 allergy season, and recruit c 150 patients over 12 sites in Germany and the US. The primary endpoint is the combined symptom medication score (CSMS) averaged over the peak grass pollen season.
Allergy Therapeutics delivered a solid 6% revenue growth for FY20 to £78.2m, from £73.7m, despite COVID-19 impacts taking a 2% toll. The well-established European commercial platform produced operating profit before R&D of £14.2m, from £11.3m, with R&D spend of £9.0m, from £13.2m. Pollinex Quattro Grass is set to start a pilot Phase III study before initiating full registration trials. The promising VLP-based peanut vaccine reported highly encouraging preclinical data which, if maintained, could be transformational for future prospects. The fruits of the development portfolio are expected to enable the market entry into the commercially attractive US. Cash resources of £37.0m are ample to fund near-term requirements. We initiate coverage with a £325m (51p a share) valuation.
Allergy Therapeutics (AGY): Corp FY 2020 – record pre-R&D EBIT | Amino Technologies (AMO): Corp Argentinian software contract win | ANGLE (AGL): Corp Peer reviewed publication, using Parsortix in MBC | Bigblu Broadband (BBB): Corp Quickline secures up to £6.1m of subsidy in Lincolnshire | Hardide (HDD): Corp Trading in line with a stronger Q1 expected | Trackwise Designs (TWD): Corp Interim results, new contracts boost confidence | Xeros (XSG): Corp Commercial progress tracking in line with expectations
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Allergy Therapeutics reported full-year 2020 results that were marginally ahead of expectations, driven by lower overhead costs (COVID-related) and lower R&D. This underpinned 25% growth in pre-R&D EBIT to £14.2m on 7% CER revenue growth and continued, albeit smaller, market share gains. Year-end net cash was £33.2m, providing the company with the financial resources to execute on current research programmes. The outlook remains characterised by the start of the Phase III Grass MATA MPL trial in US/Europe, enhanced by a broadening pipeline of opportunities and continued commercial traction in core European markets. We have made small upward adjustments to our forecasts and raise our target price to 45p, which is underpinned by the current commercial operations, with potential upside in Grass MATA MPL in the US (c.21p on risk-adjusted DCF), Polyvac peanut vaccine and the recently broadened VLP technology licence.
Allergy Therapeutics (AGY): Corp Broadening and deepening VLP vaccine pipeline | IQGeo Group (IQG): Corp US telecoms network contract win | Omega Diagnostics (ODX): Corp Mologic COVID-19 test CE Marked | President Energy (PPC): Corp Off to a flying start
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The AIM Healthcare index has risen 6% YTD in 2020, significantly outperforming the AIM All Share (-7%). AIM Healthcare also outperformed the larger cap FT All Share Health and World Health indices (+2% and +5%, respectively), which have been assisted by the defensive nature of the large cap sector against the backdrop of the COVID-19 pandemic. Fifteen finnLife 50 stocks have exhibited double-digit percentage increases YTD in 2020, a further six have exhibited triple-digit percentage increases, and one has posted a quadruple-digit rise, namely Synairgen* (+2,390%), followed by Avacta* (+654%), Omega Diagnostics* (+322%), Tiziana Life Sciences (+283%), e-Therapeutics (+265%), Oncimmune* (+209%) and Open Orphan* (+189%). We remain optimistic for the sector in 2020 given the expected inflection points and superior growth.
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AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro (PQ) is an ultra-short-course subcutaneous allergy immunotherapy (SCIT) platform, which continues to make strong market share gains in a competitive environment. Several products using the PQ platform are in late-stage development in order to move them to full registration under new EU and US regulations. Another reassuring trading update states that the company has hit new records and has the resources in place to fund its pending R&D investment programme required to get its products approved by the regulators.
Allergy Therapeutics (AGY.L): FY20 Trading Update | N4 Pharma (N4P.L): Change of adviser
Allergy Therapeutics plc N4 Pharma Plc
Allergy Therapeutics (AGY): Corp | Arcontech (ARC): Corp
Allergy Therapeutics plc Arcontech Group PLC
Allergy Therapeutics released a further positive trading update to that of 24 June, citing full-year revenues of £78.2m (+7% CER), above-market earnings and year-end cash of £37.0m (c.£5.4m higher than forecast). With confirmation that June was also a ‘normal’ month, albeit in the seasonally weaker second half, this should provide greater comfort to investors as we enter FY 2021, still with some uncertainty over the potential for second waves to disrupt patient visits. We make only minor changes to forecasts to reflect actual revenues and year-end cash in FY 2020 as well as small changes to FY 2021, but this is the third positive trading update since the interims. We reiterate our target price of 40p, which excludes any value attributed to early pipeline products and US market entry.
VarmX raises €32m in Series B financing round | Allergy Therapeutics (AGY.L): Invalidation of 2019 Phase 3 trial primary endpoint testing PQ-Birch
Allergy Therapeutics (AGY): Corp Regulatory update – Phase III birch allergy trial | Elixirr (ELIX): Corp Thriving on change | Telit (TCM): Corp Earnings well protected during COVID slowdown | Tracsis (TRCS): Corp Worst case avoided
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A number of REITs have the ability to thrive in current market conditions and thereafter. Not only do they hold assets that will remain in strong demand, but they have focus and transparency. The leases and underlying rents are structured in a manner to provide long visibility, growth and security. Hardman & Co defined an investment universe of REITs that we considered provided security and “safer harbours”. We introduced this universe with our report published in March 2019: “Secure income” REITs – Safe Harbour Available. Here, we take forward the investment case and story. We point to six REITs, in particular, where we believe the risk/reward is the most attractive.
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Much has been written about the effects of the virus on the world and on the stock market. Here is one analyst’s take on some of the likely impacts on the way we should look at companies. This article was originally produced as a blog, “10 Changes Post Virus”, which was published a few weeks ago.
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AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro (PQ) is an ultra-short course subcutaneous allergy immunotherapy (AIT) platform, which continues to make strong market share gains in a competitive environment. Several products using the PQ platform are in latestage development, with the aim of moving them to full registration under new regulatory frameworks in both the EU and the US. AGY has just announced another solid operating performance driven by top-line growth in its traditionally strong first half, with associated positive cashflow.
Allergy Therapeutics (AGY): Corp Interims – progressing to plan, upgrades due to R&D | Oncimmune Holdings (ONC): Corp Biodesix launches EarlyCDT Lung test in the US | PCI Pal (PCIP): Corp Record H1 revenue growth with a caveat on timing | Proactis (PHD): Corp Restoring forecasts after conclusion of FSP
AGY PHD PCIP
Allergy Therapeutics reported six-month results to 31 December that reflected the continued progress seen over the last few years, namely market share gains and margin (pre-R&D EBIT) enhancement. Whilst a more challenging market environment in some of its smaller territories curtailed share growth to c.50bps (rather than 100bps), revenues increased 9% (CER) to £50.5m with pre-R&D EBIT| up 10% to £17.3m and adjusted pre-tax profits (ex-£3.2m litigation payment) up 14% to £13m. With this stable growth base arguably underpinning a much higher valuation, we look forward to the start of its two-step Phase III trial for Grass MATA MPL in the US and Europe in the autumn of 2020. The market assumes little or no chance of success despite the real-world evidence for its use as well as one positive Phase III trial. We are upgrading forecasts for FY 2020 and 2021 by c.£2.1m due to lower R&D costs. Given the balance sheet (£39.75m cash), underlying growth and previous clinical trial successes, we believe the risk/reward profile is highly attractive and reiterate our target of 40p.
Allergy Therapeutics (AGY): Corp Read-across from Aimmune’s peanut FDA approval | Avacta (AVCT): Corp Cell therapy JV update | NAHL (NAH): Corp Industry-wide uncertainty | President Energy (PPC): Corp 2019 highlights and trading update
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Allergy Therapeutics plc (AGY.L): Trading update | Microsaic Systems (MSYS.L): Trading Update | Oxford BioDynamics (OBD.L): EpiSwitch™ used in diagnosis of canine cancer
AGY MET OBD
Allergy Therapeutics (AGY) is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro (PQ) is an ultra-short course subcutaneous allergy immunotherapy (AIT) platform, which continues to make strong market share gains in a competitive environment. Several products using the PQ platform are in late-stage development, with the aim of moving them to full registration under new regulatory frameworks in both the EU and the US. AGY has just announced another solid operating performance and market share gains in its traditionally strong first half, with associated positive cashflow.
The six-month trading update to 31 December 2019 demonstrates solid underlying growth, with revenues rising 8% to £50.5m (c.9% at constant exchange rates (CER)). Period-end cash was £39.7m, which included £3.2m received in settlement of legal costs relating to the litigation with Inflamax and which is already factored into FY 2020 forecasts. This implied a c.55% increase in underlying cashflows to c.£9.1m in the period. The stock trades at a c.80% discount to its peer group in terms of EV/Sales, reflecting concerns over the failed Phase III PQ Birch study in Q1 2019, which we believe significantly undervalues the intrinsic value of in-market sales and the technology platform(s). We leave our forecasts unchanged for FY 2020 at this point and reiterate our 40p target price.
The AIM Healthcare index rose by 13% in 2019, marginally outperforming the AIM All Share (+12%). AIM Healthcare was outperformed by the larger cap FT All Share Health and World Health indices (+25% and +17%, respectively), assisted by M&A activity, sustained rate of regulatory approvals and also the defensive nature of the large cap sector, set amidst Brexit uncertainty and earnings downgrades elsewhere in the market. However, there were 17 finnLife 50 stocks that exhibited double-digit percentage increases in the past 12 months, and a further four that exhibited triple-digit percentage increases; namely Silence Therapeutics (+503%), Shield Therapeutics* (+482%), ReNeuron (+184%) and Ergomed (+126%). We remain optimistic for the sector in 2020, given expected inflection points and superior growth.
AGY AVCT BVXP BYOT COG IDP IHC CNSL OPTI SDI TSTL CLBX STX TCF NIOX LDRUF DTTYF SYGGF
Allergy Therapeutics announced on 26 November that it intends to carry out a smaller trial of Grass MATAMPL in the US/Europe to determine whether the learnings from its failed Phase III trial of PQ Birch can be successfully applied to the Grass study, after which it will run the larger pivotal Phase III trial for registration purposes. This two-step approach adds an additional year to the development programme but should improve the probability of success and ensure that the more substantial investment into the pivotal study is significantly de-risked. We maintain our 40p target price, which is underpinned by the current revenue base. This excludes any value attributed to Grass MATAMPL or other early stage clinical assets.
Allergy Therapeutics (AGY) is a long-established specialist in the prevention, diagnosis and treatment of allergies. The Pollinex Quattro (PQ) platform, the ultrashort course subcutaneous allergy immunotherapy (AIT), continues to gain market share, despite its availability in the EU only on a “named-patient” basis. Several products are in clinical development, with the aim of moving the platform to full registration under the new regulatory frameworks in both the EU and the US. Management has the plan and resources to achieve the ultimate goal: to be the first to launch a fully-regulated subcutaneous immunotherapy product in the US market.
Allergy Therapeutics (AGY): Corp FY 2019 results | Chariot Oil & Gas (CHAR): Corp Interim results | Netcall (NET): Corp Low-code, high growth
AGY CHAR NET
Allergy Therapeutics reported full-year 2019 results marginally ahead of expectations, driven by lower sales & marketing expenses. This underpinned 22% growth in pre-R&D EBIT on 8% CER revenue growth and continued market share gains (0.5%), illustrating the competitive profile of the product range. Year-end net cash was £25.0m. We expect similar revenue growth in FY 2020 but, unlike prior years, no material clinical newsflow as the company prepares for its Phase III Grass trial and starts recruitment into its early mite and peanut allergy Phase II and I trials, respectively. We retain our target price of 40p, which is underpinned by the current commercial operations, with potential upside in PQ Grass in the US (c.21p on risk-adjusted DCF), Mite MPL and Polyvac peanut.
Allergy Therapeutics (AGY): Corp Trading update | KRM22 (KRM): Corp Positive trading update | Morses Club (MCL): Corp The market is changing, not shrinking – Morses Club is ready | Mporium Group (MPM): Corp Disposal of Fast Web Media
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Polarean Imaging (POLX.L): New System Order | Allergy Therapeutics plc: Earnings ahead of expectations | Reneuron (RENE.L): Preliminary results
AGY RNUGF PLLWF
https://www.hardmanandco.com/wp-content/uploads/2019/06/AGY-Trading-and-legal-update-1-July-2019.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 (SCIT), continues to gain market share despite its availability in the EU on a ‘named-patient’ (NP) basis only. Several products are in clinical development, with the aim of moving the platform to full registration under the new regulatory framework. AGY has issued a positive trading update highlighting the strong operating performance of the group. Also, it has reached a successful settlement of an ongoing legal dispute with one of its third-party R&D contractors.
Allergy Therapeutics released a trading update yesterday for the full year ending 30 June indicating earnings to be ahead of market expectations. Additionally, it reported that it has received $7.6m (£5.8m) from the successful litigation settlement relating to the PQ Grass Phase II trial conducted in North America in 2015/16. We have made changes to our forecasts to reflect the impact of both announcements, increasing statutory and adjusted pre-tax profits by £8.6m and £2.8m, respectively, for FY 2019. We reiterate our 40p target price. Whilst the market remains unsure what to make of the Phase III PQ Birch European study, reported in March, the value of its existing franchise is mis-valued in our opinion.
Allergy Therapeutics (AGY): Corp Trading update and positive litigation settlement | Mporium Group (MPM): Corp Prelims | Surface Transforms (SCE): Corp New contract from OEM 6
AGY SCE MPM
Polarean Imaging (POLX.L): Final results for year-ended 2018 | Allergy Therapeutics (AGY.L): Full year earnings ahead of expectations, successful litigation settlement
Allergy Therapeutics plc Polarean Imaging Plc
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 (SCIT), continues to gain market share despite its availability in the EU on a ‘named-patients’ (NP) basis only. The aim of ongoing trials is to move the platform to full registration under the new regulatory framework. Following the success of ‘Acarovac Plus’ in NP, the ‘Acarovac MPL’ vaccine for house dust mite allergy is in clinical development to provide a registered vaccine. Results from the Phase I trial of Acarovac MPL were positive, demonstrating safety and tolerability.
Allergy Therapeutics (AGY): Corp Positive Phase I data in house dust mite allergy
Allergy Therapeutics provided a regulatory update following its recent end-of-Phase II meeting with the FDA and the Paul Ehrlich Institut (PEI) for PQ Grass. The company indicated that the PQ Grass Phase III study will now start in FY 2020, a year later than expected, to ensure that the best possible protocol is agreed. Meanwhile, AGY continues to trade in line with expectations and gain market share, implying that physicians have not changed their prescribing habits despite the Phase III PQ Birch trial failure. We have made changes to forecasts to reflect lower R&D spend over the next two years (c.£15m) and reiterate our 40p target price.
Allergy Therapeutics (AGY): Corp Regulatory and trading update | ClearStar (CLSU): Corp Financial services client expands contract again | Europa Oil & Gas (EOG): Corp Wressle appeal date set | Lok'nStore (LOK): Corp Exciting pipeline of new landmark stores | Nasstar (NASA): Corp Prelims – showing the sector how to do it | Proactis (PHD): Corp Interims and strategic update | SimiGon (SIM): Corp FY 2018 shows recovery but SaaS transition continues
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The top-line data for Allergy Therapeutics’ Phase III PQ Birch trial in birch pollen-induced allergic rhinoconjunctivitis, released on 18 March, was disappointing but already largely discounted, in our opinion, by the 50% fall in the share price in the months prior to the data release. While the primary endpoint was not met, secondary endpoints looking at biomarker data suggest a clear pharmacological effect occurred. This is probably insufficient to sway the regulator, but gives hope that PQ Birch will ultimately be approved. PQ Birch represents c.4% of group revenues, sold on a named-patient basis, and while the result will raise questions about the viability of the broader PQ franchise, including the upcoming PQ Grass pivotal Phase III trial, the risk to revenue forecasts is considered minimal. We make no change to forecasts but reduce our target price to 40p to reflect the uncertainty over timing of future PQ clinical trials. The risk-reward profile is highly attractive at this level and significantly skewed to the upside.
Allergy Therapeutics (AGY): Corp Implications of PQ Birch Phase III top-line data | Robinson (RBN): Corp A package of upgrades for FY2019E
Allergy Therapeutics plc Robinson plc
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.
Allergy Therapeutics (AGY): Corp Very strong interims; awaiting PQ Birch Phase III data | Avesoro Resources (ASO): Corp New Liberty PFS, guidance and budget update | Frontier Developments (FDEV): Corp A second licensed game to boost FY 2022 | Omega Diagnostics (ODX): Corp VISITECT CD4 update – expect Q1 CE Mark | ThinkSmart (TSL): Corp New lease of life on the horizon
AGY FDEV CNSL TSL ASO
Allergy Therapeutics reported six-month results to 31 December with revenues in line with the 16 January trading update but profits and margins materially higher than we would have envisaged, some of which is timing-related and some structural given the positive market-share momentum. Whilst revenues increased 11% CER to £46.7m, the leverage afforded a largely static cost base, resulting in pre-tax profit growth of 70% with pre-R&D EBIT up 27% to £15.7m. We use this opportunity to adjust our forecasts, lifting revenues by c.£1m. The current share price is largely discounting a failed Phase III outcome for PQ Birch, which is due to report in Q1 2019. Given the balance sheet (£31.5m cash), underlying growth and previous clinical trial successes, we believe the risk/reward profile is highly attractive and reiterate our target of 47p.
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. The Pollinex Quattro (PQ) platform, the ultra-short course subcutaneous allergy immunotherapy (AIT), continues to gain market share, despite its availability in the EU only on a ‘named-patient’ basis. 2019 is expected to deliver progress in several areas, notably PQ Birch, for which top-line Phase III data are due in 1Q’19. Later this year, AGY will commence the pivotal Phase III trial for PQ Grass which will support both an EU and US registration package. Meanwhile, the ‘in-market’ performance of AGY’s products is exceptional, with further market share gains.
AIM Healthcare Index is up 10% year to date, outperforming the AIM All Share (+6%) and FT All Share (+7%), having suffered with the broader market pull back in Q4 2018, in which AIM Healthcare fell 18%. This compared with a 22% decline in the AIM All Share and 11% decline in the FT All Share. In the past quarter, the AIM Health sector has fallen 1%, not helped by the FDA’s rejection of Motif Bio’s NDA for iclaprim. However, there were 14 finnLife 50 stocks that exhibited double-digit percentage increases, most notable of which are Futura Medica (+112%), Avacta* (+82%), OptiBiotix* (+35%), hVIVO (+34%), Instem (+34%) and ANGLE* (+29%) in the past three months
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The six-month trading update to 31 December 2018 demonstrates stronger-than-expected growth, with revenues rising 10.6% to £46.7m (c.11% at constant exchange rates (CER)). This led to a c.60% increase in cashflows before financing (+c.£5.9m) with cash balances at 31 December of £31.6m that included £10.2m from July’s placing. The stock trades at a c.65% discount to its peer group in terms of EV/Sales as the market anxiously awaits the Phase III PQ Birch data, due in Q1 2019. We leave our forecasts unchanged for FY 2019 at this point and reiterate our 47p target price.
Allergy Therapeutics (AGY): Corp Trading update – strong rebound | President Energy (PPC): Corp Building critical mass | SCISYS (SSY): Corp Another contract win in Space | Somero Enterprises (SOM): Corp Trading ahead of expectations, 5% EPS upgrade | Tracsis (TRCS): Corp Acquisition
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AIM Healthcare Index fell 10% in the past three months, compared with an 8.5% decline in the FT AIM All Share. The performance stats in the past month were more balanced, with AIM Health down 1.5% compared with a 3% decline in the AIM All Share. Despite this, ten finnLife 50 stocks showed positive gains with four rising by 15%+: namely Tiziana Life Sciences (+89% – FDA clearance to start Phase I trial with foralumab, an orally delivered antibody, and the announced intention to IPO on NASDAQ); Sinclair Pharma (+46% – agreed takeover); Omega Diagnostics (+28% – strategic update); and Creo Medical (+28% – product launch). Conversely, Diurnal shares fell c.80% on the back of a failed Phase III trial for Chronocort in chronic adrenal hyperplasia
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Allergy Therapeutics’ full-year results for the year ending 30 June 2018 showed an adjusted LBT of £5.9m (vs -£1.3m in FY 2017), which was £3m better than forecast and helped by phasing of R&D spend. Key drivers were growing market share (+100bps) and rising gross margins (290bps) despite the weak allergy season. This led to pre-R&D EBIT rising 26% to £9.3m. We keenly await the outcome of the Phase III PQ Birch allergy trial, the results of which are due by year-end. We make changes to our forecasts to reflect the increased R&D spend over the next three years and to take account of the dilution afforded by the £10.6m placing in July. We retain our target price of 47p, which is underpinned by the current commercial operations, with potential upside in PQ Grass in the US (c.33p on risk adjusted DCF) as well as Acarovac MPL (house dust mite) and Polyvac peanut.
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro (PQ) Grass, the subcutaneous allergy immunotherapy (AIT), continues to gain market share despite being available in the EU only on a ‘named-patient’ basis. The Phase III trial, designed to obtain approval for PQ Birch as a biologic in Europe, is well advanced and will report data by the end of 2018. As discussed at the interim stage, underlying sales growth was affected by a low pollen season in central Europe. Full-year results suggest that this has remained a difficult market, but one in which AGY has continued to gain market share.
Allergy Therapeutics (AGY): Corp FY 2018 beat with pivotal year ahead | eServGlobal (ESG): Corp On the HomeStraight | Omega Diagnostics (ODX): Corp Allersys update – first (albeit modest) purchase order | ZOO Digital (ZOO): Corp Positive AGM statement
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AGY is a long-established specialist in the prevention, diagnosis, and treatment of allergies. Pollinex Quattro (PQ) Grass, the subcutaneous allergy immunotherapy (AIT), continues to gain market share despite being available in the EU only on a ‘Named Patient’ basis. The Phase III trial, designed to obtain approval for PQ Birch as a biologic in Europe, is well advanced and will report data shortly. As explained at the interim stage, underlying 1H’18 sales growth was affected by a low pollen season in central Europe. A trading statement indicates that this has remained a difficult market, but one in which AGY has continued to make market share gains.
Allergy Therapeutics (AGY): Corp FY 2018 trading update | Avesoro Resources (ASO): Corp Ndablama exploration update | CyanConnode (CYAN): Corp H1 revenues more than entire FY 2017
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A trading update for the year ending 30 June 2018 indicates revenues of £68.3m, some 2.5% (£1.8m) below our forecast, although the 0.7% market share increase during a weak pollen season underlines the continued positive momentum of its franchise. However, with costs in line with expectations and working capital benefits, year-end cash was £3m better than our forecast, coming in at £15.5m (net debt of £12.4m). We keenly await the Phase III European Birch trial results, which are still expected to report in August. We make modest changes to our forecasts (-£0.5-0.6m at the pre-tax level) but retain a target price of 47p.
A highly statistically significant dose response from the Phase II Grass MATA MPL/PQ Grass trial in Europe enables the company to confidently select a dose to take into a pivotal Phase III trial for US and European registration purposes. This is the first of two material clinical trial readouts this year. The Phase III Birch allergy study is expected in H2 2018, safety data from which might be able to be included as part of the safety package needed by the FDA for Grass MATAMPL. We maintain a target price of 47p and expect to upgrade on positive PQ Birch results. Further upside (33p) exists for the Pollinex Quattro Grass programme in the US.
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro (PQ) Grass, the subcutaneous allergy immunotherapy (SCIT), continues to gain market share despite being available in the EU only on a ‘Named Patient’ basis. As part of a programme designed to get PQ Grass formally approved in both Europe and the US, AGY has announced positive results from its Phase II dose-ranging clinical trial. It has identified the optimum dose as needed to move forward into the final Phase III efficacy trials, and to become the first SCIT product to be registered in these important pharmaceutical markets.
Allergy Therapeutics (AGY): Corp Positive Phase II PQ data – significant value inflection | CyanConnode (CYAN): Corp FY 2018 revenue on track with new regions opened | Omega Diagnostics (ODX): Corp VISITEC CD4 update
AGY CYAN CNSL
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.
Allergy Therapeutics (AGY): Corp PPP – Polyvac Peanut Progress | Avingtrans (AVG): Corp Interim results – trading on track | PPHE Hotel Group (PPH): Corp Well placed to expand portfolio further | Savannah Resources (SAV): Corp Scoping Study starts at Mina do Barroso
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AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro (PQ) Grass, the subcutaneous allergy immunotherapy (AIT), continues to gain market share despite being available in the EU only on a ‘Named-Patient’ basis. Trials designed to obtain regulatory approval as a biologic for PQ Birch in Europe, and for PQ Grass in both Europe and the US, are well advanced. Recruitment to the Phase II PQ Grass trial is complete: more than 440 patients have undergone conjunctival provocation testing in a placebo-controlled, dose-response and safety study. Data are now expected in early 2H calendar 2018.
Allergy Therapeutics Flash : PQ Grass Phase II recruitment complete
Allergy Therapeutics (AGY): Corp - Phase II grass trial fully recruited ahead of schedule; ANGLE (AGL): Corp - Gone FISHin’; Lok'nStore (LOK): Corp - Strong trading with six more stores in development; Proactis (PHD): Corp - Positive trading update Proteome Sciences (PRM): Corp - Trading update ; Savannah Resources (SAV): Corp - Drilling results from Mina do Barrosso, Portugal
AGY CLBX LOK PHD PRM SAV
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro (PQ) grass, the subcutaneous allergy immunotherapy (AIT), continues to gain market share despite being available in the EU only on a ‘Named Patient’ basis. Trials designed to obtain regulatory approval for PQ approved as a biologic in both Europe and the US are well advanced. Meanwhile, although underlying sales growth was weaker than expected in 1H’18, this was on the back of an unusually shorter and lower pollen season in central Europe, suggesting that AGY has continued to make further market share gains.
The trading update for the 6 months to 31 December 2017 indicated revenues of £42.2m, an increase of 4.4% or 1.3% CER. Despite a weaker birch pollen season, affecting the whole market (which declined by c.3%), the company continued to gain market share (+1% point to 14%), emphasising the interest for its ultra-short course vaccines. We have reduced adjusted pre-tax profits by c.£1m per annum as a consequence but point to the upcoming H2 clinical catalysts when its Phase III Birch and Phase II Grass trials read out. We maintain a target price of 47p, which implies a CY adjusted 2018 EV/Sales of 3.7x (in line with peer group).
Allergy Therapeutics Flash : Interim trading update
Conviction List Q1 2018 :
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Allergy Therapeutics : Completion of PQ Birch Phase III study recruitment (09-Jan-2018)
Allergy Therapeutics^ (AGY): PQ Birch Phase III recruitment completed (BUY) | 4imprint^ (FOUR): Lower US tax enhances EPS and cash generation (BUY)
Allergy Therapeutics plc 4imprint Group plc
Allergy Therapeutics : OralVac co-development agreement with Ergomed (12-Dec-2017)
As a therapeutic area, allergy is sometimes considered to be slightly ‘awkward’: disease-modifying treatments are challenging to develop with recent high-profile failures in the UK markets; the regulatory backdrop is somewhat dominated in Europe by the German TAV process; and the US doesn’t yet represent the market opportunity in allergy as it does traditional bio/pharma. If investors were to look a little closer, however, they would see Allergy Therapeutics building a significant position with excellent commercial traction and materially differentiated products based on proprietary IP. We update forecasts and repeat our Buy recommendation and 53p target price, and look towards a period of news-driven catalysts.
Allergy Therapeutics’ recent results for the year ending 30 June 2017 showed an adjusted LBT of £1.3m (vs -£11.7m in FY 2016), driven by growing market share, 15% CER revenue growth and rising gross margins (290bps). This led to pre-R&D EBIT rising 72% to £7.4m. The lower R&D (£9.3m vs £16.3m in FY 2016) relates to phasing of clinical trials and is expected to increase to c.£18m in FY 18. Year-end cash was £22.1m (net debt £18.8m). We make only minor changes to our forecasts (principally £2m better cashflow), leaving the target 2018 EV/Sales multiple at 3.5x, implying a target price of 47p. PQ Grass in the US is worth an extra c.30p, based on a risk-adjusted DCF valuation.
President Energy* (PPC): Placing and open offer (CORP) | Allergy Therapeutics (AGY): Focus on pre-R&D EBIT growth (BUY) | Boot (Henry) (BOOT): Materially head of expectations (BUY)
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Allergy Therapeutics has announced the start of dosing in its PQ Grass Phase II trial, following approval of the CTA (Clinical Trial Application) which was announced last month. We expect a 2H 2018 read-out of results which should pave the way towards the late-stage clinical development cycle for PQ Grass in the US. Actually, the next 12 months will be rather important for Allergy on PQ not only will G205 read out in 2H18, we should also expect the results of the PQ Birch Phase III trial, being the first pivotal Phase III trial for a Pollinex Quattro product in Europe. With continued strengthening of the company’s pipeline and commercial traction (we refer investors to our recent prelims commentary) we repeat our Buy recommendation.
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro continues to gain market share despite being available in the EU only on a ‘Named Patient’ basis. Investment in marketing over the last three years has been reflected in exceptional growth, with +10% CAGR in sales over the last five years compared to overall allergy vaccine market growth of +1%. In fiscal 2017, AGY gained another one-point market share to 13%. R&D investment in clinical trials for full approval as a biological in both Europe and the US are progressing with results due to be released in the second half of calendar 2018.
Momentum, momentum, momentum. Strong results, continued operational progress and a machine working well – revenues in-line with the upwardly revised estimates, R&D tax credits deliver a loss better than we had anticipated and strong cash balances position the group well for its growth ambitions. We repeat our Buy recommendation.
Allergy Therapeutics (AGY): Focus on pre-R&D EBIT growth (+72%) (BUY) | CityFibre* (CITY): On tenterhooks for the big contract (CORP)
Allergy Therapeutics plc Cityfibre Infrastructure
Allergy Therapeutics has announced that its Phase II clinical trial investigating the dosing of PQ Grass has received clinical trial application (CTA) approval for various European countries as planned. With the study expected to begin ‘imminently’, we expect a 2H 2018 read-out of results which should pave the way towards the late-stage clinical development cycle for PQ Grass in the US. With momentum building and prelims expected later this month, we repeat our Buy recommendation.
Allergy Therapeutics has announced new senior appointments and the expansion of the R&D and clinical teams in-line with its wider strategic growth plans at its Worthing headquarters. This is an important period for Allergy Therapeutics, as it invests in a variety of key programmes and platforms in order to drive significant value upside and we consider the continued investment in R&D and clinical development teams – the R&D team has doubled by headcount since 2016 – re-emphasises AGY’s commitment to its long-term growth strategy. We repeat our BUY recommendation and look towards results later this month for further updates and detail.
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro continues to gain market share despite being available in the EU only on a ‘Named Patient’ basis. Trials for full approval as a biological have progressed well in the EU, with the first patient recruited in the pivotal birch pollen allergy vaccine Phase III trial. US trials are back on-track with a new safety trial underway. Investment in marketing infrastructure over the last two years is bearing fruit with strong underlying sales growth in a flat market, improving market share by an estimated two percentage points.
Allergy Therapeutics has released a strong trading update for the year, building on the tremendous double digit growth as seen at interims, reporting that revenues for the full-year are expected to be ahead of market expectations at £64.1m (2016: £48.5m), ahead of our previous £61.8m estimate. This represents a rate of +15% annual growth on a constant currency basis and +32% reported. A solid performance, upgrades to our revenue estimates and continued market share gains reinforce our Buy recommendation.
Allergy Therapeutics has announced the publication of two studies of its novel adjuvant systems in malaria and influenza vaccines in peer-reviewed journals. These are preclinical studies, carried out through Allergy’s Bencard Adjuvant Systems division. We most recently discussed the potential of Allergy’s MCT platform in the context of our recent site visit last week (see our note of 30 June 2017). Today’s news further emphasises the quality of Allergy Therapeutics’ platforms and also the strategy of its Bencard Adjuvant Systems division in extending the use of MCT and VLP (Virus Like Particle) technologies in areas of unmet need such as infectious disease.
Allergy Therapeutics received analysts and investors at its Worthing Headquarters earlier this week. The site visits were hosted by Manuel Llobet, Chief Executive Officer, Nick Wykeman, Finance Director and Dr Murray Skinner, Chief Scientific Officer, and included KOL presentations from Professor Lawrence DeBuske, Clinical Professor of Medicine at the George Washington University School of Medicine, and Professor Dr Matthias Kramer, International Medical Director of Allergy Therapeutics.
Allergy Therapeutics has announced the hosting of a satellite symposium “The Best Therapies by Design” which was held at the 36th Annual Congress of the European Academy of Allergy and Clinical Immunology (EAACI) in Helsinki, Finland on 18 June 2017.
Allergy Therapeutics has announced the appointment of Dr Tunde Otulana as Non-Executive Director, effective from today. We consider the appointment of Dr Otulana as a meaningful addition to the Allergy Board. Alongside significant industry experience, Dr Otulana also spent over six years working at the US FDA as a Medical Officer and Medical Team Leader in the Division of PulmonaryAllergy Drug Products. On this basis, we consider his experience particularly pertinent given Allergy Therapeutics’ US ambitions. We maintain our Buy recommendation.
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro continues to gain market share despite being available in EU only on a ‘Named Patient’ basis. Trials to obtain full approval as a biological have progressed well in EU with the first patient recruited in the pivotal birch pollen allergy vaccine Phase III trial. US trials are back on-track with a new safety trial underway. A Phase I study of Acarovac MPL, a ‘dust mite allergy’ vaccine, has been approved in Spain for 32 patients. Finally, Polyvac Peanut has completed preclinical testing and has potential to significantly disrupt the peanut allergy market.
Allergy Therapeutics (AGY) the UK-based, specialty pharmaceutical company focused on the development, manufacture and sale of vaccines and other products for the treatment and prevention of allergies, today reported its Interim results for the 6 months to Dec 31, 2016, traditionally the company’s strongest half due to the clinical seasonality of allergy vaccination programmes. These Interim results provide greater detail on the company’s excellent performance, as indicated in January in the trading update, and support our upgraded full year revenue forecasts at that time. Net sales grew by 39.3% (18% at CER) to £40.4m, giving rise to adjusted EBITDA pre-R&D of £12.3m and net cash of £24.4m (as at Dec 31, 2016). Importantly, in broadly flat markets AGY continued to increase its share (to 13% from 12%), a reflection of the strong quality and advantages of its leading Pollinex® Quattro allergy vaccines. On the basis of this performance our sales forecasts for FY2017 and beyond were upgraded. We are increasingly confident that the strength of the core business combined with the advancing product pipeline (with PQ Birch now in phase III and Acarovac MPL in phase I) will be duly recognised by investors and that the current share price represents an attractive entry level relative to our risk-adjusted NPV of 69p per share.
Allergy Therapeutics reported six-month results to 31 December in which there were no real surprises given the 19 January trading update. Revenues increased 39% (18% CER) to £40.4m, driven by further market share gains, which in turn generated a c.4x increase in adjusted pre-tax profit to £7.5m (£1.5m), benefiting from both operational leverage and FX rates. Apart from a slightly lower than expected H1 R&D charge, which is likely to be timing-related, we make no changes to our forecasts and point to the strong first-half seasonality of the business. We retain a near-term target price of 43p and point to the potential further upside (30p+ on a risk-adjusted DCF basis) that the Pollinex Quattro (PQ) Grass programme in the US offers.
Allergy Therapeutics’ interims follow the company’s detailed January trading update which prompted us, at that time, to upgrade our forecasts given the strength of the performance. Constant currency revenue growth of +18% and market share gains don’t happen by accident – this reflects the strategy of delivering effective, differentiated products as exemplified by the Pollinex franchise allied with investment in infrastructure. Recent pipeline progress (see our update notes during February and March) point to the long-term product opportunities in terms of portfolio expansion. Given we upgraded our forecasts in January, we make minimal changes on the back of today’s update and maintain our investment thesis. Buy.
Allergy Therapeutics (AGY) is a UK-based, specialty pharmaceutical company focused on the development, manufacture and sale of vaccines and other products for the treatment and prevention of allergies. This morning AGY announced that it has initiated B301, the phase III clinical trial of its Pollinex Quattro® – Birch vaccine (PQ-Birch), with the recruitment of the first patient into the study. A total of 550 patients are expected to be recruited and treated across more than 50 sites in northern Europe including Germany, Austria, Sweden and Poland. Assuming a positive outcome for B301, we believe that in 2018 the company will be able to submit an application for marketing authorisation under the TAV to the German biologics medicines regulator, the Paul Ehrlich Institute. Germany is the biggest single European market for allergy vaccines and such a submission could see a marketing authorisation granted in 2019. Our riskadjusted fair value estimate remains at 69p per share.
Allergy Therapeutics has announced the recruitment of the first patient in its Phase III study (B301) to evaluate the efficacy and safety of Pollinex Quattro Birch. This follows the positive Phase II study which the company reported in May 2016 and sees the Pollinex Quattro Birch programme moving fully on track against the timeframe outlined after the B204 study. We expect the Phase III to run for over one year, and if successful could potentially see marketing authorisation in 2019. With continued pipeline progress adding to recent updates on house dust mite and peanut programmes, we repeat our Buy recommendation.
Allergy Therapeutics (AGY) is a UK-based, specialty pharmaceutical company focused on the development, manufacture and sale of vaccines and other products for the treatment and prevention of allergies. This morning AGY announced that it has obtained approval in Spain for its Clinical Trial Application (CTA) to advance its next generation house dust mite (HDM) vaccine candidate, Acarovac MPL, into phase I clinical development. This vaccine addresses a significant market for allergy sufferers estimated to be worth $1.5 billion annually. As with the recent news that the company is progressing its peanut allergy vaccine, this HDM vaccine further broadens AGY’s vaccine portfolio beyond the seasonal allergies to include this common perennial allergy. Our riskadjusted fair value estimate remains at 69p per share.
Allergy Therapeutics has announced that a Phase I clinical study to investigate the safety and tolerability of Acarovac MPL (‘Acarovac Quattro’) has received CTA (clinical trial application) approval in Spain. This means the company now expects to begin Phase I studies immediately in order to assess the safety and tolerability of two different dose regimens. With both pipeline progress (for example, the company also recently updated on the positive preclinical programme in Peanut) aligned with strong commercial progress, we maintain our investment thesis, SOTP-derived 53p target price and repeat our Buy recommendation.
Gresham House Strategic* (GHS): Mind the gap (CORP) | LiDCO* (LID): Trading update (CORP) | Allergy Therapeutics (AGY): Acarovac Quattro to start Phase I trials (BUY)
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AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Trials to obtain full regulatory approval as a biological for its ultra short-course immunotherapy, Pollinex Quattro, have progressed well in the EU, and are back on-track in the US with a planned new safety trial. Meanwhile, AGY acquired novel virus-like particle (VLP) technology with the goal to develop a short-course therapeutic vaccine for peanut allergy. Positive safety and efficacy results from proof-of-concept pre-clinical tests with Polyvac Peanut are very encouraging. A small safety study in humans is required before Phase I trials can commence.
Allergy Therapeutics (AGY) is a UK-based, specialty pharmaceutical company focused on the development, manufacture and sale of vaccines and other products for the treatment and prevention of allergies. This morning AGY announced that it has obtained positive preclinical Proof-of-concept results for its Polyvac® Peanut candidate vaccine. The results demonstrate that a single shot of the vaccine protected against anaphylaxis in a peanut allergen challenge test. The candidate vaccine will now progress into phase I clinical development. While this peanut allergy vaccine programme is at an early stage of development, it is encouraging that the company’s virus-like-particle (VLP) adjuvant platform has demonstrated both safety and efficacy in this model. Ultimately, this platform could potentially enable the company to expand its product portfolio outside its historic focus to also include, among others, the large market opportunity of food allergies. Our risk-adjusted fair value estimate remains at 69p per share.
Allergy Therapeutics provided an update on its peanut allergy vaccine programme, Polyvac Peanut. It confirmed the successful completion of preclinical Proof of Concept studies in which both safety and efficacy were seen, and that it will now progress towards a first-in-man safety study and Phase I trial, the funding for which was put in place as part of the £12m financing in November 2015. We reiterate our Buy recommendation and target price of 43p, which is driven by the profitable European business. Additionally, we consider Pollinex Quattro in the US to be worth 30p on a rNPV basis. One can now begin to think about attributing some value to Polyvac, albeit still with risk and many years from market.
Allergy Therapeutics has announced positive results from preclinical research into its unique therapeutic peanut allergy vaccine, Polyvac Peanut. The key finding we’d highlight in this morning’s statement is that the company has demonstrated a single dose of the VLP adjuvant combined with recombinant peanut allergen successfully protected against anaphylaxis when challenged with peanut. Furthermore, when examining symptom scores in theinvestigational model, those vaccinated with the candidate vaccine exhibited no symptoms compared to placebo. The company will now proceed to Phase I development following completion of a first in man safety data trial.
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro continues to gain market share despite being available in Europe only on a ‘Named Patient’ basis. Trials to obtain full regulatory approval as a biological have progressed well in the EU, and are back on-track in the US with a planned new safety trial. AGY remains on course to have the first short-course allergy vaccine approved in both Europe and the US. Meanwhile, an excellent trading performance in 1H’17 shows that AGY is continuing to gain market share from its international peers.
Allergy Therapeutics (AGY), the UK-based, specialty pharmaceutical company focused on the development, manufacture and sale of vaccines and other products for the treatment and prevention of allergies, this morning released a pre-close trading update for the 6 months to Dec 31, 2016. The company has highlighted a period of strong growth in revenue, driven through gains in market share and also currency movements. AGY anticipates that it will report H1 revenues of approximately £40.4m (we had expected £35.4m). Importantly, the company has confirmed that its clinical development plans as outlined last year for Pollinex Quattro (PQ) Birch and PQ Grass have been agreed with regulators in Europe and the USA. The company had cash of £27.8m at December 31st 2016. We have revised our financial forecasts for the coming years with increases in sales and gross margins as well as overheads. Our risk-adjusted fair value estimate now stands at 69p per share (previously 66p).
Allergy Therapeutics released a trading update for the 6 months to end December 2016, demonstrating stronger than expected growth, driven by growth across its portfolio, market share gains and small one-offs. Revenues increased 39% to £40.4m, an increase of 18% at constant exchange rates (CER). We have upgraded our revenue forecasts for FY 2017 to £62m (+4%). Adjusted pre-tax losses consequently are reduced by c£0.5m to £3.2m. Leaving the target EV/Sales multiple unchanged at 3.2x, we increase our target price by 7% to 43p. Interim results are due on 29 March.
Allergy Therapeutics has released an interim trading update for the six months to 31 December 2016 with 1H reported revenues ‘ahead of expectations’ and expected to be £40.4m (2015: £29.0m) which represents growth of 17.9% at constant currency, or +39.3% on a reported basis. We upgrade forecasts – mainly focusing on the revenue line for FY17E and FY18E (+5.5% in each year) at this stage – but it is clear that commercial momentum is strong. A regulatory update on the US Grass MATA MPL programme also sees the company looking to carry out the planned dose-ranging study in 2017 following discussions with the US regulator. Good progress, the stock still represents an excellent opportunity for investors given current levels and the trajectory of the sales line. We remain buyers.
As always at the start of a year, there are significant uncertainties about the year ahead but I think in 2017, the level of uncertainly has decisively moved up a gear. In fact, a leading economist at the LSE, Ethan Ilzetzki, was recently quoted as saying “I view the current global economic environment as the most uncertain in modern history”. Wow.
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Allergy Therapeutics is a European specialty pharmaceutical business focused on immunotherapeutic vaccines for the treatment of moderate to severe allergies. It has a profitable underlying European business with growing market share and strong sales growth (11% CAGR 2014-16), which we value at 40p per share, based on a peer group comparison of EV/Sales. In addition, we consider the US clinical programme for Pollinex Quattro to be worth c.30p, based on a risk-adjusted DCF valuation. Further strategic assets that could exploit the untapped market for food allergies (e.g. peanut) are excluded from the valuation. We initiate coverage with a Buy recommendation.
Allergy Therapeutics (AGY): Nuts about Allergy (BUY) | Fenner (FENR): Q1 trading – trading ahead of expectations (BUY) | Elecosoft* (ELCO): CFO to leave this year (CORP)
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Allergy Therapeutics (AGY) is a UK-based, specialty pharmaceutical company focused on the development, manufacture and sale of vaccines and other products for the treatment and prevention of allergies. The company today announced that the European Patent Office has granted a broad patent covering the novel manufacture and physico-chemical properties of its unique microcrystalline tyrosine (MCT) depot adjuvant. Our risk-adjusted fair value estimate remains unchanged at 66p per share.
Allergy Therapeutics has announced that the European Patent Office has granted a broad technology patent relating to the Company’s unique Microcrystalline Tyrosine (MCT) depot adjuvant manufacturing process. While we do not expect today’s news necessarily to act as a catalyst for the share price, the further strengthening of Allergy’s IP position is clearly positive news. We maintain our investment thesis and repeat our Buy recommendation.
Allergy Therapeutics has announced that data will be presented today at the World Vaccine Congress, demonstrating significant improvements in effective infectious disease applications using Bencard Adjuvant Systems (BAS, the fullyowned Allergy Therapeutics division) technology. The company has long demonstrated its commercial application – and the growing commercial strength – of its differentiated product offering, and we have consistently emphasised the company’s technology platforms as underpinning this offering. As such, the ability to combine its portfolio of adjuvants to create new systems for use in allergy and infectious disease applications is an exciting step forward, in our view. We remain BUYers.
Allergy Therapeutics (AGY) the UK-based, specialty pharmaceutical company focused on the development, manufacture and sale of vaccines and other products for the treatment and prevention of allergies, today reported its full year results to June 30, 2016. Financial performance was ahead of expectations with net sales growth of 12.2% (19% at CER) to £48.5m (forecast £47.5m, £47.8m consensus), adjusted EBITDA pre-R&D of £6.3m (£4.9m forecast) and net cash of £20.0m (£16.8m forecast). Importantly, during the period AGY increased its market share to 12% (from 10%) in key markets, a strong achievement reflecting the strength of its products and commercialisation efforts. On the basis of this performance in its European markets, we have upgraded our sales forecasts for FY2017 and beyond. We have also reduced our R&D in the short term given the need for a new US Pollinex® Quattro (PQ)-Grass dose-ranging study and the resulting delay to starting a US phase III trial. Long term, the strength of the core business combined with the advanced and broadening product development pipeline give us confidence that the current share price represents an attractive level to buy relative to our risk-adjusted fair value estimate of 66p per share.
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. Pollinex Quattro continues to gain market share despite being available in Europe only on a ‘Named Patient’ basis. Trials to obtain full regulatory approval as a biological have progressed well in the EU, but the setback in the US will delay market entry by approximately 12 months. Despite this, AGY remains on course to have the first short-course allergy vaccine approved in both Europe and the US. Despite an operational performance significantly better than all of its competitors, AGY still trades well below the ratings of its international peer group.
The dramatic – and historic – vote on June 23rd for the UK to exit the EU caught many organisations short, not least the EU itself. Both stock markets and currency markets were anticipating a narrow majority for the UK to remain within the EU – on a similar basis to the 2014 Scottish referendum. But it was not to be. As a result, the financial markets have reacted sharply in recent months, although other non- Brexit factors have also come into the equation.
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‘Smaller UK public companies, typically those below £100m in size, face many barriers to accessing growth capital from the stock market. Poor liquidity results in these companies being perceived as private companies with a quote’.
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Allergy Therapeutics has announced a trading update for the year ended 30 June 2016. Reported revenues are expected to be slightly ahead of consensus expectations at £48.5m (PGe £48.1m, FY15: £43.2m), reaffirming the strength of sales commentary made most recently within the company’s 27 June 2016 release. This represents a reported YOY growth rate of +12% despite the negative impact of the weakening Euro throughout most of FY16, and a constant currency growth rate of +19%. Today’s news, in our view, further reaffirms our position as stated both at the end of June - in response to the US GrassMATAMPL update - and earlier this week, within our Conviction List for 3Q 2016 note. We repeat our Conviction Buy
Our Conviction List returned -3.2% over the last 12 months; this was set against the DS Small Companies index that returned -15.5% over the same period. Since its inception in 2010, the Conviction List has outperformed the market in 13 of 17 periods and a reinvested Conviction List would have returned 235% since its inception against a reinvested DS Small Companies index that would have returned just 22%. Our Q3 portfolio reflects our outlook for a slowdown in UK growth during the second half of 2016. Downside risks to domestic growth stem from the uncertainty of the EU Referendum result, but cyclical growth was already slowing as a rebound in energy costs and ongoing austerity was set to weigh on growth. A bright spot for equities is the increasingly dovish Federal Reserve, now expected to leave US rates unchanged throughout 2016. The relentless drive lower in corporate and non-corporate fixed income yields continues to provide a valuation underpin for global equities.
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Allergy Therapeutics has been on our Conviction Buy list for 12 months but, following a strong share price performance in 2H15, the stock has been weaker in 1H16. The end-June announcement on US GrassMATAMPL further set the tone on the share price and additional dose-ranging work looks set to add circa 12 months to that development programme vs management expectations, while bringing the timeframe into line with ours. In the meantime, however, +19% YTD constant currency revenue growth sends the message of continued strong commercial traction. With our investment thesis fundamentally unchanged despite the speedbump of the US dose-ranging study, we view the share price reaction offers investors an excellent opportunity. We repeat our Conviction Buy.
Our Conviction List returned -3.2% over the last 12 months; this was set against the DS Small Companies index that returned -15.5% over the same period. Since its inception in 2010, the Conviction List has outperformed the market in 13 of 17 periods and a reinvested Conviction List would have returned 235% since its inception against a reinvested DS Small Companies index that would have returned just 22%.
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This morning Allergy Therapeutics (AGY), a fully integrated European specialty pharmaceutical company focusing on allergy vaccines, announced that results from a 1-year follow-up study of the house dust mite (HDM) vaccine, Acarovac PlusTM, have been published in the peer-reviewed journal, Immunotherapy. The previously disclosed results of this follow-up study in 30 adult patients, conducted under normal clinical practice, showed a statistically significant reduction of >50% in symptom scores after 1-year. Publication in Immunotherapy should further help to grow sales of the product which have grown to over EUR1 million in the key markets of Spain and Portugal.
Allergy Therapeutics has announced publication of 1-year follow up results of its mite allergoid immunotherapy Acarovac Plus™, in the peer-reviewed journal Immunotherapy. The results, in our view, are compelling. The company reports a statistically significant reduction in symptom scores observed at both followup visits (4 weeks and 1 year), with >50% reduction in symptom scores recorded after 1 year. We consider this plays well to the key points of Allergy’s platform which we have outlined previously: namely that an effective technology platform has the potential to deliver differentiated products with improved adherence and compliance, ultimately delivering benefits to the patient. We retain our investment thesis and repeat our Buy recommendation.
In recent years, various sectors have seen dreadful share price performances, not least the banks once the magnitude of the 2008 credit crisis became all too apparent.
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Allergy Therapeutics has announced findings from the mEEC dose-ranging study G204 from the US GrassMATAMPL clinical development programme. Further dose range finding will be required in order to optimise the recommended dose before starting the pivotal Phase III trial (G306). While we anticipate this will potentially add circa 12 months to the development road-map, the nowexpected absence of a high-profile peer in the future US marketplace – Circassia – combined with accelerating commercial penetration in Europe (constant currency revenue growth +19% YTD vs +12% FY2015) – means we retain our wider investment thesis unchanged. Allergy Therapeutics remains a Buy and we consider any weakness this morning represents an excellent buying opportunity.
This morning Allergy Therapeutics (AGY), a fully integrated European specialty pharmaceutical company focusing on allergy vaccines, announced that the results from its latest phase 2 dose range finding clinical trial for GrassMATAMPL (the development version of Pollinex® Quattro Grass) were inconclusive. As a consequence, the company is not yet able to recommend a dose to take into the final phase 3 trial as expected. The company has indicated that it will proceed with a pre-planned meeting with the FDA later this year during which it will discuss the G204 findings (among others) and present its plans for a new dose range finding study. We estimate these events necessitate a delay of around 1 year to the start of phase 3 development for GrassMATAMPL but do not affect any other clinical development programmes being conducted by the company (i.e. the Birch vaccine phase 3 trial). In light of recent FX movements (AGY’s revenues are largely EURO denominated) and today’s announcement, our fair value for the company now stands at 66p (from 69p).
This morning Allergy Therapeutics (AGY), a fully integrated European specialty pharmaceutical company focusing on allergy vaccines, announced that on the 12th of June information relating to the adjuvant components of its innovative allergy vaccine technologies were presented in a satellite symposium hosted by the company at the 35th Annual Congress of the European Academy of Allergy and Clinical Immunology.
Allergy Therapeutics has announced the presentation of data in a Satellite Symposium “Adjuvants in Allergy: elevating efficacy” at the 35th Annual Congress of the European Academy of Allergy and Clinical Immunology (EAACI) in Vienna on 12 June 2016. The continued recognition of its innovative platforms further highlights Allergy Therapeutics’ leading role within the industry. We repeat our Conviction Buy.
Allergy Therapeutics has announced the appointment of Nick Wykeman (exSkyepharma) to the Board as Finance Director with immediate effect. We view today’s appointment as a solid fit, filling the position that has been open since the announcement earlier this year, with an individual whose life sciences and wider background aligns well with the Allergy business.
Our key feature article, titled “The Capital Cycle of a Growth Company”, looks at two key related issues that many growth companies typically face with insufficient consideration: 1) Who will be their next investors? 2) What will their investors expect from in return? The author, Antony Gifford, has had a distinguished career as an investment manager for 19 years, having worked for Hardman Global Investors, Deutsche Asset Management and Flemings.
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This morning Allergy Therapeutics (AGY), a fully integrated European specialty pharmaceutical company focusing on allergy vaccines, announced excellent headline results from its large phase IIb clinical trial of Pollinex® Quattro Birch (PQBirch204). The trial was designed to determine the safest, most effective cumulative dose of the modified, tyrosine-adsorbed, Birch allergen and the MPL adjuvant for subsequent use in an upcoming European phase III trial. The study showed the vaccine was safe and well-tolerated at all doses tested and the strong dose-response relationship established will guide the company to the optimal dosing in the phase III trial expected to begin in early 2017.
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. It’s lead product, Pollinex Quattro is available in Europe only on a ‘Named Patient’ basis. However, protocols have been agreed with EU and US regulators for a programme of clinical trials to get full regulatory approval of Pollinex Quattro as a biological. AGY has reported positive outcomes from one of the trials required for EU approval. There remains a considerable valuation mis-match between AGY and its peers, which provides scope for considerable upside towards our riskadjusted DCF valuation of 89p per share
Allergy Therapeutics has announced top-line results from its PQBirch204 Phase II study. Primary endpoint has been met and the results have proved the dose-response relationship. Not only does this pave the way towards the Phase III programme on track (expected to commence early 2017), it also potentially acts as a validating/de-risking reference for the company’s wider Pollinex Quattro platform. On this point, we remind investors we will be looking towards results from the US GrassMATAMPL Phase II study in 2H16. Our SOTP valuation presently only includes pipeline representation through the US study so not only does progress on PQBirch offer potential upside, it also helps to underpin confidence in the technology and clinical strategy. In our view the current 26p share price represents an unduly onerous discount against our 53p target price. Allergy Therapeutics remains a Conviction Buy.
Nigel Hawkins is again our feature writer of the month. Last month it was a review of the UK/ EU Electricity Sector – this time he has again turned his attentions to UK/EU Relations by assessing the risks to the UK financial and business sectors from our possible exit from the EU. The main conclusions from Nigel’s analysis are: The £ Sterling will be volatile, especially if Brexit prevails. Few of the largest FTSE 100 stocks are heavily exposed to the EU- Vodafone being a notable exception. A vote for Brexit may be the start of a long drawn out process of exiting the EU – if the UK Parliament approves the relevant legislation. Major changes in the tariff rates would have a significant impact but existing trade arrangements may last for many years.
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We added Allergy Therapeutics to the Conviction List in Q315 and the strength of the share price performance during 2H15 saw the stock as one of our top performers. Interim results in March confirmed strong double digit constant currency revenue growth against a flat market backdrop. We expect catalysts in 2016 to include key clinical updates and continued commercial traction underpinning market share gains, so with the share price presently in the mid- 20p range we repeat our Conviction Buy.
Our Conviction List returned 9.1% over the last 12 months; this was set against the DS UK Market that returned -3.4% over the same period. Since its inception in 2010, the Conviction List has outperformed the market in 13 of 16 periods and a reinvested Conviction List would have returned 257% since its inception against a reinvested DS UK Market index that would have returned just 43%.
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Allergy Therapeutics (LSE: AGY) is a UK-based, European specialty pharmaceutical company focused on the development, manufacture and sale of vaccines and other products for the treatment and prevention of allergies. This morning it reported its Interim results for the 6 months to Dec31, 2015, in which sales growth reached 12% (CER, 3% reported). As sales are heavily seasonal and skewed to the H1 period (60-70% of annual sales), AGY reported adjusted Operating Profits of £1.5m (FY2015: £7.7m), down due to the well- flagged ramp-up in R&D spending on clinical development of its lead products. AGY continues to progress its Pollinex® Quattro-based (PQ) vaccines through advanced clinical trials in preparation for pivotal phase III trials later this year. Results for two phase II trials for PQ-Grass and PQ-Birch allergies, expected in H2 this year, will guide the final design of the phase III PQ Grass trial. We believe that management is effectively steering AGY towards significant value
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. The first half of fiscal 2016 has been fueled by the progress made in the clincal trials required to get full marketing approval as a biological in both the US and Europe. Key results are due in both set of trials in the forthcoming six months. Meanwhile, investment in marketing of Pollinex Quattro in Europe to expand market share ahead of full marketing approval has borne fruit in the first half. The company is well funded to deliver on its strategy with its short-course allergy vaccines expected to enter the market as a disruptive technology in 2019.
Our key feature this month is a review of the UK/EU Electricity sector by Nigel Hawkins who has recently joined Hardman to cover the utilities and renewable energy market. Nigel has had a long career in the City covering both industries having worked at Hoare Govett covering water and electricity privatisation, and at Yamaichi and W de Bröe.
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With £11.5m recently raised to support major pipeline expansion (including the newly acquired VLP technology to develop a peanut allergy vaccine) and further small accretive deals, Allergy (AGY) is well placed for the rest of 2016. The US opportunity for the Pollinex Quattro ultra-short course range remains potentially transformational, but AGY is also targeting a greater share of the expanding EU market. Our increased DCF valuation of £274m is fair value, ahead of multiple potential catalysts over the next year.
Allergy Therapeutics (AGY) a UK-based, European specialty pharmaceutical company is focused on the development, manufacture and sale of vaccines and other products for the treatment and prevention of allergies. The value of the company is underpinned by strong fundamentals including annual sales over £45m with gross profits leveraging investments in R&D and advanced clinical development of its leading Pollinex® Quattro (PQ) vaccines supported by extensive clinical trial evidence (over 3,000 patients) and named-patient product (NPP) sales in Europe (over 250,000 patients treated). PQ vaccines have the advantage of being delivered in a short-course format helping to ensure strong compliance and are formulated with the adjuvant, MPL, and carrier, MCT, both of which augment efficacy and strongly differentiate the products from other injected allergy vaccines. Near-term new product development and regulatory successes for its PQ vaccines will add substantially to sales, improve product margins, and drive profits, particularly as products are launched in the USA, a multibillion USD market. We believe the current share price of 27p represents a clearly attractive level to buy as we initiate coverage with a risk-adjusted fair value estimate of £405m corresponding to 69p per share.
Following interim results earlier this week, we’re taking the opportunity to update numbers to account for a variety of variables including currency, market backdrop/peer group and investment phasing. We think R&D costs – primarily associated with the ground-breaking US development programme for Pollinex Quattro Grass – will likely dig deeper particularly in FY17E, but increased investment in commercial infrastructure will see accelerated top line growth. Given the market potential, both in terms of commercial traction in Europe and the major opportunity for Pollinex Quattro Grass in the US, we consider the strategy remains compelling. We repeat our Buy recommendation and raise our target price to 53p (51p) based on SOTP valuation.
This month’s feature article is the first publication of the top 15 drug companies in the 2015 global industry ranking and how this has changed over the last decade. In trying to analyse the changes that have taken place, we have looked at different strategies used by management teams. Many companies are featured, but there is emphasis on GlaxoSmithKline (GSK), AstraZeneca (AZN) and Shire Pharmaceuticals (SHP). In addition, we have analysed how drugs derived from antibodies have driven market growth and now represent just over 10% of annual industry sales.
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Today’s interim results confirm strong double digit constant currency revenue growth against a flat market backdrop and, even accounting for currency headwinds, the business has been tracking in-line with our full-year expectations. It is Allergy’s mix of continued commercial traction and breadth of new product opportunities that underpins our investment case on the stock. Our target price of 51p gives strong upside against current levels and having undertaken the placing in November, we consider the company well-resourced to identify, target and acquire/license additional products to add to the current portfolio. Given the trajectory of today’s update and further news flow catalysts within the near- and medium-term, we repeat our Buy recommendation.
AGY is a long-established specialist in the prevention, diagnosis and treatment of allergies. It has an underlying profitable and cash generative business despite its lead product being available only on a ‘Named Patient’ basis. However, protocols agreed with EU and US regulators are in place to get Pollinex Quattro approved as a biological. The US opportunity is enormous and only two players have short- course treatments. There is a valuation mis-match between AGY and its peers, which either have no growth or little marketing experience, which provides scope for considerable upside towards our risk-adjusted DCF valuation of 89p per share.
This morning Allergy Therapeutics has announced it has completed patient enrolment for its Phase IIb dose-finding study, G204, in the US. GrassMATAMPL is the company's programme for Pollinex Quattro Grass in the US (an ultra-short course SCIT, subcutaneous allergen specific immunotherapy) and total patient enrolment for the Phase IIb study was 250 patients. Headline data for the G204 study are expected at the end of the first half of 2016, paving the way for the US Phase III study.
Allergy Therapeutics' 1H trading update sees market share gains in all of its major European markets, reflected in strong double digit constant currency revenue growth (+12% vs 1H15 +11%) to deliver 1H revenues (CER) of c.£31.5m (1H15: £28.2m). On a reported basis (i.e. accounting for currency headwinds of c.£2.5m) the company still expects to see 1H growth of +3% to c.£29.0m (1H15: £28.2m) and, on this basis, continues to track in-line with full-year expectations. Against the flat market backdrop we consider Allergy's underlying double digit performance as exemplary – as we'd expect for a Conviction List stock – and retain our Buy recommendation and 51p Target Price.
The Panmure Gordon Conviction List returned 23.3% in 2015; this was set against the DS All Share that returned -2.3% over the same period. This represents the 14th period out of 16 where the Conviction List has outperformed the market benchmark and means that a reinvested Conviction List would have returned 175% since its inception in 2010 against the DS All Share that returned 20%. Top long performers in 2015 were Ryanair, Avacta Group, Bovis Homes, Informa and Micro Focus, while the best short ideas were Petra Diamonds, Fenner, Rolls-Royce, Majestic Wine and Vesuvius.
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Investors following Allergy's peers will have noted the evolving news this month relating to Stallergenes, which reported a suspension of manufacturing at its Antony (France) plant in early December due to problems encountered in the launch of a new IT business operations system. Press reports of a recall of all products released from the site since August suggest, to us, there is likely to be some upside opportunity for Stallergene's competitors. We've highlighted Allergy's ongoing market share gains against a flat European backdrop – we consider this additional dynamic might also provide some (temporary) tailwind effect in certain product categories. We maintain our investment thesis unchanged.
This morning Allergy Therapeutics has announced the enrolment of the first ten US patients in its GrassMATAMPL (GMM) 204 phase II study (G204). This is part of the clinical programme for the company's development of Pollinex Quattro Grass for the US which, with today's news, we see tracking on plan. Not only does this show progress against the timetable it also serves as a reminder of the breadth of the business which, with the recent £11.5m (gross) fund-raise has seen the company acquire a licence for VLP that will underpin an entry into food allergy with Polyvac Peanut, alongside the acceleration of its in-house Acarovac programme. Don't forget, this is also a commercial business, delivering market share gains against a flat European backdrop. We repeat our Buy recommendation.
This morning Allergy Therapeutics has announced it has completed enrolment with 364 patients in PQBirch204, its phase II randomised, double-blind placebo-controlled dose selection study for Pollinex Quattro Birch. The study is planned to complete by February 2016 with results available in Q2 2016 and should pave the way towards the start of the phase III study in 1Q17. We retain our investment thesis and repeat our Buy recommendation.
Following today's early-morning trading update and placing announcement, Allergy has announced it has successfully raised c.£11.5m (before expenses) by way of placing 41,005,500 new ordinary shares (representing c.7.5% of the existing share capital) at 28p. With a strengthened balance sheet and ahead-of-market growth we consider both existing and planned organic opportunities, combined with a strategy to drive inorganic growth, underpin an exciting growth story for the long-term. We raise our target price to 51p (47p) and repeat our Buy recommendation.
This morning, Allergy Therapeutics has announced a strong trading update for the first four months of 2016 (+12% like-for-like constant currency growth, or +15% including the Alerpharma acquisition which was completed June 2015) which, considering the flat market backdrop and the reported FY15 constant currency sales growth of 11%, represents a robust performance. In this context, the company has announced the proposed placing via accelerated bookbuild to raise up to £12m which will be targeted to support the development of two specific product opportunities, including the first entry into food allergy with Polyvac Peanut, and the supported development of Acarovac Quattro (house dust mite). These represent substantial new market opportunities and we will be updating our view (forecasts, valuation) in light of the further announcements.
The Financial Conduct Authority fears that the lack of transparency in investment and corporate banking and bundling reduces competition. They are in the process of a major study into this whole field. Any action they take is likely to hit the revenue model of these firms. Perhaps the traditional and unique British model of corporate broking will not survive.
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9.2% outperformance in Q3 sounds good, but set against a market that fell 9.1% this is hardly a great result. The disparity of performance was enormous with a couple of true mistakes in the Mining and Oil & Gas sector taking a heavy toll. For Q4 we have cut some losses and introduced Greene King, Microfocus and Wentworth on the Long calls with two new high conviction Short calls in Rolls Royce and Majestic Wine. Total outperformance since 2010 is 114% with 2 negative quarters out of 28. It seems there may be some alpha in our analyst's stock knowledge.
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Revenues as flagged, but a stronger-than-expected gross margin performance means the reported operating profit of £0.7m is well ahead of our breakeven estimate. News flow has been strong recently so today's statement gives investors a chance to reflect, again, on market-outperformance across Europe, the Alerpharma acquisition and the US opportunity for Pollinex Quattro Grass. We maintain our forecasts and reiterate our Buy recommendation.
This morning, Allergy Therapeutics has announced the first patient enrolment in its Pollinex Quattro Birch dose ranging study conducted in Germany and Austria. In parallel, we note management's statement that the US Pollinex Quattro Grass clinical programme is ‘advancing well' and the company expects to announce the enrolment of the first patient in November 2015. The development progress announced today across the Pollinex Quattro range bodes well for the future positioning of the business and we repeat our Buy recommendation.
In our recent note (‘Born in the USA', 25 June) we discussed in some detail Allergy Therapeutics' differentiated technology platform as a key element of the group's competitive positioning. This morning, the group has announced the publication of a key paper and featured article in the World Allergy Journal, about proteomics in the field of allergy. We regard the advancement of research at the cutting edge of the field represents a continued recognition of its importance on the part of the company, and that publication of such research represents independent recognition of the quality and novelty of Allergy Therapeutics' platform.
A strong trading performance sees the company expecting to report 2015 revenues of £43.2m vs PGe £42.9m (2014: £42.0m), up 3% in spite of Euro weakness, reflecting underlying revenue growth of 11% (£46.6m constant currency). Outperformance against flat market growth is translating to market share gains of c.1% p.a. and, alongside M&A (most recently with Alerpharma S.A.) and the funded US pipeline programme (Pollinex Quattro), we consider there are strong long-term drivers for value creation. We maintain our investment thesis and repeat our Buy recommendation.
Allergy Therapeutics (AGY) will start PQ Grass US approval studies in Q315. The convenience of the ultra-short course vaccine and US physician preference for subcutaneous immunotherapy (SCIT) could lead PQ to gain a large share of the c $2bn allergy immunotherapy (AIT) market given that it could be the first licensed seasonal SCIT. The acquisition of Alerpharma reinforces AGY’s position in the c €72m Spanish AIT market and enlarges its manufacturing capability. Our DCF valuation increases to £260m.
Allergy Therapeutics has announced positive results from its prospective observational Acarovac Plus clinical study for the treatment of house dust mite allergy. The product is being developed as one of the company's new generation of products to address the perennial allergy market with innovative and short-course therapies.
Q2 has witnessed a post budget rally in domestic consumer cyclicals causing Bovis Homes to be the best performer in our Conviction List, followed by Ryanair. Disappointments in Q2 were on account of external factors such as the short on Weir being defeated by Oil Price strength and our long in Aviva being overwhelmed by Grexit sentiment. Our analysts stock specific picks for Q3 centre around reliable, quality earnings, with a strong valuation influence. The bottom up stock picks of our analysts suggest we are moving from risk on post budget to risk off ahead of Grexit.
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Allergy Therapeutics issued a trading update with, revenue growth ahead of our forecasts (c2.1% on a statutory basis). Statutory results, however, do not tell the full story as the company performed very strongly with double-digit growth (c11%) shown in constant currencies in the period. Further on, the investment case should be strengthened this year as a US strategy becomes clearer. We make no changes to forecasts at this stage and re-iterate our Buy recommendation and 28p target price.
