Scancell
Oxford, United Kingdom

Scancell is a clinical-stage immuno-oncology specialist that is developing two innovative and flexible therapeutic vaccine platforms. ImmunoBody and Moditope induce high avidity cytotoxic CD8 and CD4 responses, respectively, with the potential to treat various cancers.

www.scancell.co.uk

Investment Perspective

Scancell has reported H119 results in line with expectations. The cash position was £7.6m, with the net loss of £3.24m compensated for by the two equity raises, totalling £14.9m, over the past year. Development appears to be progressing well, with important clinical programmes expected to start patient recruitment during the next two quarters. Additionally, in January 2019 the management team has been strengthened by two important new hires. We value the company, using a risk-adjusted DCF model, at £82.0m or 17.2p a share.

Market information

SymbolPrimary exchanges
SCLPAIM London

Research

Ground prepared for an important period
Lighthouse | 01 Jul 2019
Vulpes investment brings £3.88m in new funds
Lighthouse | 13 Jun 2019
SCIB2 to use new nanoparticle formulation
Lighthouse | 20 May 2019

Recent News

H1 2019 business update
01 Jul 2019
Board appointment
18 Jun 2019
Share subscription and issue of equity to Vulpes Life Sciences Fund
13 Jun 2019
Update on SC1B2 development
20 May 2019
Hutchison China MediTech
Hong Kong, China

Hutchison China MediTech (Chi-Med), a Hong Kong-based biopharmaceutical company, is on track to become a global leader in the discovery, development, and commercialisation of innovative, highly selective oral tyrosine kinase inhibitor therapies for oncology and immunological indications.

www.chi-med.com

Investment Perspective

Hutchison China MediTech (Chi-Med) H119 results highlight ongoing financial and operational progress. First China NDA filings for surufatinib and savolitinib are on track for H219 and H120 respectively, following in the footsteps of Elunate’s November 2018 launch. Global registration studies of surufatinib and fruquintinib will also initiate in H120. Investment into the maturing China Oncology and Global Innovation pipelines means future R&D spend will continue to grow, but Chi-Med is well-funded with flexibility surrounding future funding options. These are not limited to a future Hong Kong IPO, but include prospects of enhanced revenues from Elunate (post potential NRDL inclusion in Q4) and near-term China approvals/launches, plus possible non-dilutive finance from non-core asset divestment (eg OTC). Our valuation remains $38.55/ADS ($5.14bn) or £5.93/share (£3.95bn).

Market information

SymbolExchanges
HCMNASDAQ/AIM London

Research

Carrying momentum into H219
Update | 13 Aug 2019
Secondary ADS offering trims CK Hutchison stake
Lighthouse | 28 Jun 2019
Surufatinib on track for potential 2020 China approval
Update | 18 Jun 2019

Recent News

2019 Interim Results and Clinical Update
30 Jul 2019
Chi-Med to announce H119 financial results
03 Jul 2019
Pricing of upsized US Public Secondary Offering of ADS
28 Jun 2019
Secondary Offering of ADS
28 Jun 2019
Mereo BioPharma
London, United Kingdom

Mereo BioPharma develops and commercialises innovative therapeutics addressing rare diseases. It also has specialty pharmaceutical products that it will partner. The assets are acquired or licensed in at clinical stages from large pharmaceutical companies. The portfolio consists of six compounds that are in clinical development.

www.mereobiopharma.com

Investment Perspective

Mereo BioPharma has reported encouraging interim results from BPS-804’s Phase IIb trial in osteogenesis imperfecta (OI). Interim data from the open label arm of the 112-patient ASTEROID study showed a 1.4% improvement over baseline in the primary endpoint at three months and a 3.2% improvement at six months. The secondary endpoint showed a 3.5% improvement at six months. Clearly the sample size in this study arm is small (11 and 12 patients), but these data suggest the 12 month results (expected in Q419) should show further improvement. Importantly, no cardiac safety signals were noted. We value Mereo BioPharma at 506p/share or $25.59/ADS.

Market information

SymbolExchanges
MPH/MREOAIM London/NASDAQ

Research

Accelerated approval path for NAVI
Lighthouse | 16 Jul 2019
Encouraging interim BPS-804 data in OI
Update | 31 May 2019
Focus shifts back to imminent data
Update | 08 May 2019

Recent News

Successful Type B Meeting with U.S. FDA
15 Jul 2019
Richard Francis appointed Head of Pharmaceutical Development
01 Jul 2019
Conversion of loan note and issue of equity
21 Jun 2019
Update on etigilimab TIGIT partnership
13 Jun 2019
Nexstim
Helsinki, Finland

Nexstim is a targeted neuro-modulation company that has developed a proprietary navigated rTMS platform for use in diagnostics (NBS) and therapeutics (NBT). NBS is used in planning brain surgery while NBT is focused on depression and chronic pain. FDA approval for depression was given in 2017, and the focus is on commercial roll out in the US, Europe and Asia.

www.nexstim.com

Investment Perspective

Nexstim has successfully secured funding to enable the commercialisation of its proprietary Navigated Brain Therapy (NBT) platform in MDD (major depressive disorder). The near-term challenges now shift to maximising the uptake of NBT in specialist centres in North America and Europe. Initial indications are encouraging, with notable support from major centres and key opinion leaders. Our valuation and financial models have been updated to reflect the capital raise. We value Nexstim at €18.8m or €0.53 per share (€0.40 diluted), against €35.5m, or €1.00/share (€0.73/share diluted) were the remaining financial risks removed.

Market information

SymbolExchanges
NXTMH/NXTMSHelsinki/Stockholm

Research

Getting back on the front foot
Update | 21 May 2019
Terms of the rights issue announced
Lighthouse | 28 Mar 2019
Securing the commercial future of NBT in depression
Update | 18 Mar 2019

Recent News

NBT system authorized for commercial distribution in Australia
05 Aug 2019
Second NBT system ordered by Island Psychiatry
03 Jul 2019
Wings for Life Foundation funding for Finnish spinal cord injury rehabilitation research using SmartFocus technology
26 Jun 2019
Positive feedback from leading Austrian clinic on its first NBT system
18 Jun 2019
Bonesupport
Lund, Sweden

Bonesupport is an orthobiologics company focused on developing and commercialising a pipeline of unique injectable drug-eluting, bioceramic bone graft substitutes based on its proprietary CERAMENT technology.

www.bonesupport.com

Investment Perspective

Bonesupport delivered its best quarterly net sales (SEK37.3m) in Q219, with this third successive quarter of CERAMENT sales growth providing early confirmation that the commercially focused strategy is starting to deliver. The next two quarters will be key for the company in setting the trajectory for future sales potential. Q319, the first full quarter of exclusive US sales, should see first sales under major US GPO contracts, publication of full CERTiFy data driving adoption in trauma, and the expanded global commercial footprint being closer to full operation. With the growth trajectory yet to be established, we conservatively rebase our 2019 and 2020 revenue expectations to reflect a more gradual ramp in sales. We continue to view management’s target of 40%+ revenue growth from 2020 onwards as achievable and anticipate more detailed guidance at the Capital Markets Day planned for H219. Our revised Bonesupport valuation is SEK37/share (or SEK 1.92bn), down from SEK39/share (or SEK 2.03bn).

Market information

SymbolPrimary exchangeCurrency
BONEXOMX StockholmSEK

Research

All eyes on Q3 following a record Q2
Update | 31 Jul 2019
Building momentum
Update | 07 May 2019
Gearing up for growth
Update | 01 Mar 2019

Recent News

Q219 report
25 Jul 2019
Item affecting comparability in Q219
19 Jul 2019
Bulletin from the annual shareholders meeting
14 May 2019
Q119 Report
02 May 2019
e­-therapeutics
Oxford, United Kingdom

e­-therapeutics is a drug discovery company with a proprietary network­ driven drug discovery platform, which uses using artificial intelligence (AI), machine learning and other computational techniques.

www.etherapeutics.co.uk

Investment Perspective

e-therapeutics ended its FY19 (year-ending 31 January 2019) on a high, securing its first commercial collaboration with Novo Nordisk in December (see Update note). Business development and cost control were the focus areas for FY19. The Novo deal in Type 2 diabetes marked a first success on the former, providing important validation for e-therapeutics’ proprietary Network-Driven Drug Discovery (NDD) platform. Prudent cost management means end-FY19 cash of £5.9m, coupled with an anticipated £1.1m tax credit, provides a two-year runway on our estimates. The goal is to now capitalise on ongoing, and new, business development discussions covering the full range of e-therapeutics’ assets and capabilities, to help progress NDD-derived projects and further exploit the NDD platform. Our valuation is £57.8m (21.9p/share).

Market information

SymbolPrimary exchanges
ETXAIM London

Research

Second agreement helps validate capabilities
Lighthouse | 13 Aug 2019
Setting the stage
Update | 06 Mar 2019
First commercial deal secured with global diabetes leader
Update | 10 Dec 2018

Recent News

Notice of AGM and annual report
08 Mar 2019
FY19 results
05 Mar 2019
Research Collaboration with Novo Nordisk
10 Dec 2018
Initial results of C4X Parkinson’s Disease Collaboration
06 Dec 2018
MaxCyte
Gaithersburg, United States

MaxCyte has a patented flow electroporation platform, which can transfect a wide array of cells. It generates revenues from the sale and lease of equipment, disposables and licence fees; with an impressive client list. Additionally, a novel mRNA mediated CAR technology, known as CARMA, is being explored in various cancers, including solid tumours.

www.maxcyte.com

Investment Perspective

MaxCyte is maintaining its momentum, delivering revenue growth of 21% during H119 and having grown at a CAGR of 24% over the last four years. This was driven in part by the number of licensed cell therapy programmes increasing by c 10 to over 80. As was highlighted at the Capital Markets Day last week, the demand for MaxCyte’s technology, especially from those companies developing cell therapies, is only likely to grow. Cell therapy companies are focussing more on gene-modified therapies and are increasingly looking for alternatives to viral methods, leaving MaxCyte ideally positioned to benefit. At the same time, development of MaxCyte’s CARMA platform advances as expected: data from the current Phase I/II trial are due in H120. We value MaxCyte at £195m or 341p per share.

Market information

SymbolPrimary exchange
MXCT/MXCRAIM London

Research

Ideally placed to sustain growth
Update | 17 Jul 2019
Dosing advances to second cohort in CARMA Phase I
Lighthouse | 08 May 2019
At the forefront of the cell therapy revolution
Update | 24 Apr 2019

Recent News

Trading update
17 Jul 2019
Capital Markets Day 2019
11 Jul 2019
CARMA Phase I trial progresses
08 May 2019
FY18 results
24 Apr 2019
Kind Consumer
London, United Kingdom

Kind Consumer has developed a novel nicotine delivery device that mimics the important aspects of cigarette smoking. Uniquely, the Voke device is registered as a medical product, yet it can still be sold easily (General Sales List). Management aims to market Voke directly in the UK, ahead of licensing out for other geographies.

www.kindconsumer.com

Investment Perspective

Kind Consumer is poised to introduce Voke, a novel nicotine delivery device, into the UK market. Voke closely mimics the key aspects of cigarette smoking, but without tobacco’s harmful effects. The notable recent shifts in consumer acceptance of such novel devices suggest market adoption will be positive. The development, regulatory, and production processes have now been completed. Management is seeking funds to execute its commercialisation plans. Our rDCF valuation, using modest assumptions for the UK only, yields a value of £154m.

Market information

SymbolPrimary exchangeCurrency
N/APrivateGBP

Research

No smoke but plenty of fire
Initiation | 11 Oct 2017

Recent News

Appointment of new CEO
01 Jan 2019
Further funding to support manufacturing facilities and commercial launch of Voke
15 Aug 2018
BAT and Kind Consumer announce new approach to commercialise Voke
05 Jan 2017
BerGenBio
Bergen, Norway

BerGenBio is a clinical-stage, biopharmaceutical company based in Bergen, Norway and Oxford, UK. It is developing innovative therapies for aggressive cancers by way of inhibiting the AXL signalling pathway. The lead oncology compound, bemcentinib, is in multiple Phase II trials.

www.bergenbio.com

Investment Perspective

BerGenBio has raised NOK74.2m in a private placement to advance its clinical pipeline, as it plans the late stage Phase II studies in acute myeloid leukaemia (AML) and non-small cell lung cancer (NSCLC) with bemcentinib. Promising efficacy signals have been seen during the current Phase II study in AML as a monotherapy, and the latest data continues to suggest that bemcentinib enhances the activity of LDAC chemotherapy. Similarly, the current Phase II trial in NSCLC with bemcentinib in combination with pembrolizumab (Merck’s Keytruda) suggests the two therapies act synergistically. Following the capital raise, we value BerGenBio at NOK3.21bn (NOK53.13/share).

Market information

SymbolPrimary exchanges
BGBIOOslo

Research

Private placement to support randomised Phase II trials
Update | 19 Jun 2019
ASCO: more supportive data for bemcentinib
Update | 05 Jun 2019
Efficacy endpoint met in Phase II AML study
Lighthouse | 02 Apr 2019

Recent News

Preliminary Phase II AML data for bemcentinib in combination with low dose chemotherapy at EHA 2019
14 Jun 2019
Completed private placement
14 Jun 2019
Phase II elderly AML data for bemcentinib in combination with low dose chemotherapy at ASCO 2019
03 Jun 2019
Preliminary clinical and biomarker data from Phase II advanced NSCLC trial with bemcentinib and Keytruda at ASCO 2019
02 Jun 2019