Ideally placed to sustain growth

Update | 17 July 2019

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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.

Year-end: December 31201720182019E2020E
Sales (US$m)14.016.720.925.2
Adj. PBT (US$m)(9.9)(8.9)(14.5)(14.9)
Net Income (US$m)(9.9)(8.9)(14.5)(14.9)
EPS (USc)(20.4)(17.3)(25.6)(25.9)
Cash (US$m)25.314.414.41.1
EBITDA (US$m)(9.1)(8.1)(13.4)(13.6)
Source: Trinity Delta Note: Adjusted numbers exclude share-based payments and exceptionals.
  • Strong revenue growth maintained in H119 MaxCyte sales in H119 rose by 21% to $8.4m (H118: $6.9m), sustaining its >20% top-line growth. The company also launched a new product suite of ExPERT instruments, which have been designed to respond to the growing needs of its clients and to sustain the company’s leadership in the field of non-viral cell modifications. This should contribute to growth in FY19 being weighted to H2, as is common for MaxCyte.
  • Evolving demand from cell therapies During H119, the number of new cell therapy programmes with licences to use MaxCyte’s technology has risen by c 10 (>80 in total), with the number with clinical licences growing by c 10 to >45 (including the agreement with Kite, a Gilead Company). Demand for MaxCyte’s technology for cell therapies is expected to drive its sales growth. Industry-wide, there were 362 clinical trials with gene-modified cell therapy in 2018 (an increase of 40% vs 2017), and there is also a growing realisation of the limitations of viral modifications. MaxCyte offers one of the few alternative methods to efficiently and reproducibly modify cells for therapies.
  • Lead CARMA asset advancing as expected MCY-M11 in ovarian cancer and mesothelioma is the first CARMA product to enter the clinic. MaxCyte has completed the first dose cohort and, in May, started the second cohort in the first Phase I trial. Reassuringly, no dose-limiting toxicities or safety concerns were observed in first patient cohort and we continue to expect first detailed data from the trial to be reported in H120.
  • Valuation unchanged at 341p/share We continue to value MaxCyte at £195m or 341p per share, and there are no changes to our estimates. Our valuation of the core business excluding CARMA is £111m, which is 53% more than the current market cap.


17 July 2019

Market Cap£72.8m
Enterprise Value£59.7m
Shares in issue57.3m
12 month range125.0-243.0p
Free float70%
Primary exchangeAIM
Other exchangesNA
Company CodeMXCT.L
Corporate clientYes

Company description

MaxCyte uses its patented flow electroporation platform to transfect a wide array of cells. Revenues arise from 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.


Mick Cooper PhD
+44 (0) 20 3637 5042

Lala Gregorek
+44 (0) 20 3637 5041

MaxCyte is continuing to grow strongly with sales increasing by 21% to $8.4m during H119. The number of cell therapy programmes with commercial licences (that include milestone payments) also rose from >35 to >45; this should ensure the current sales momentum is maintained and could accelerate. Key to the company’s success is its leading position in the non-viral cell modification market. To maintain its leadership, MaxCyte launched a new product suite under the ExPERT brand; and the company continues to benefit from the rapid increase in cell therapies in development, and the switch to non-viral modifications of cells. We maintain our valuation at 341p/share.

ExPERT: a versatile non-viral transfection platform

MaxCyte already had developed a flow electroporation platform with the ability to insert any molecule into any cell, efficiently and reproducibly. This is important as different companies use alternative methods to modify their cell therapies, and MaxCyte’s instruments can serve all of their needs (Exhibit 1).

Exhibit 1: Non-viral genome editing technologies
Source: Trinity Delta, company websites    Note: TALE = Transcription Activator Like Effector; PAM = protospacer adjacent motif, a DNA motif specific to each Cas9 protein; sgRNA = single-guide RNA

It was, however, important that MaxCyte’s systems kept pace with the demands of its clients, especially in the dynamic cell therapy field. The ExPERT range has the necessary extra capabilities (eg touch screen controls, bar code reader etc) and has also been designed with lifecycle management in mind. Thus, it can continue to evolve and, over time, MaxCyte intends on adding further platform improvements, such as upstream and/or downstream sample preparation capabilities.

A summary of the ExPERT range and its functionality is detailed in Exhibit 2. The GTx is designed for GMP manufacturing of clinical cell and gene therapies; the STx for drug discovery applications such as protein production and cell-based assay development; and the ATx for academic institutes initiating the development of cell and gene therapies. MaxCyte also produces the VLx for biomanufacturing. Importantly, it is possible to move seamlessly from one instrument to another as products move through the development cycle.

Exhibit 2: The instrument features of GTx, STx and ATx ExPERT systems
Source: MaxCyte

Well-positioned for cell and gene therapy market growth

The rapid growth in programmes licensed to use MaxCyte’s systems reflects both the strength of the technology and the favourable market conditions. In 2018, companies developing gene and gene-modified cell therapies raised $9.7bn, an increase of 64% on the previous year. Analysis of clinical trials also showed there were 362 clinical studies being conducted with gene-modified cell therapies in 2018 compared to 259 in 2017 (+40%), while the number of clinical trials with unmodified cell therapies fell 25% to 263 (Exhibit 3).

Exhibit 3: Trials underway worldwide by specific technology in 2018
Source: Alliance for Regenerative Medicine, Trinity Delta

Among those companies developing gene-modified cell therapies, there is also a move away from viral transduction, currently the most popular method of modifying cells. The reasons why companies are looking at alternatives include:

  • Technical considerations, including the need to deliver more than one payload efficiently into a cell, as is needed for CRISPR therapies.
  • Immunology issues: virally transduced cells can induce an immune response so repeat dosing of a cell therapy might not be possible.
  • Cost of viruses: a batch of Lentivirus, sufficient to treat 2-10 patients, costs c $500k.
  • Complicated manufacturing procedures which are required with viruses.

The switch towards alternative methods, and in particular the adoption of MaxCyte’s technology, is highlighted by Kite Pharma (a Gilead company). Kite is a leader in the field of CAR-T therapies and historically has solely used viral transduction. In November 2018, however, the company entered into a research agreement with MaxCyte to start developing cell therapies modified using flow electroporation; this relationship was expanded in March 2019 by signing a clinical and commercial agreement that covered the development of up to 10 therapies.

Attractive revenue potential from commercial licenses

The number of cell therapy programmes covered by licences to MaxCyte’s technology has grown rapidly over the last few years, and we are now seeing many of the research agreements transitioning into commercial licences (Exhibit 4). The latter licences are considerably more lucrative to MaxCyte; for example, there is the potential to earn over $250m in milestones from the 35+ programmes, including those from the CRISPR Therapeutics and Precision Biosciences commercial agreements (Exhibit 5).

Exhibit 4: The growth in licensed cell therapy programmes
Source: MaxCyte, Trinity Delta
Exhibit 5: Commercial licences granted to date
Source: MaxCyte, Trinity Delta, Company websites.  Note: Casebia is a joint venture between CRISPR Therapeutics and Bayer; R/R = relapsed/refractory; NHL = non-Hodgkins lymphoma; ALL = acute lymphoblastic leukaemia; CLL = chronic lymphocytic leukaemia; AML = acute myeloid leukaemia; MCL = mantle cell lymphoma.

MaxCyte estimates that the NPV of each programme with a commercial license is on average c $10m at the start of clinical development, after considering the development and commercial risks. It should be noted that not all programmes covered by a commercial licence will enter clinical development. Also, in common with most licensing agreements, the deals are backend-weighted with the most significant potential payments to MaxCyte dependent on the programme becoming a marketed product, as illustrated in Exhibit 6.

Exhibit 6: An illustration of the structure of a representative commercial licensing agreement for a single product
Source: MaxCyte

The first products using MaxCyte’s systems as an enabling technology are now in clinical development and we expect several more to enter the clinic over the coming years (Exhibit 7). It is also likely that other companies have products that depend on MaxCyte’s technology already in the clinic, but many are cautious about disclosure due to the highly competitive nature of the space.

Exhibit 7: Selected preclinical and clinical partners
Source: Trinity Delta, company presentations,


First CARMA therapy advancing in the clinic as planned

CARMA is MaxCyte’s proprietary autologous mRNA-based CAR therapy platform, and the lead therapy MCY-M11 entered the clinic in H218 (Exhibit 8). The Phase I trial with MCY-M11 has a dose escalation 3+3 design with intraperitoneal dosing and is progressing as planned. The 1 x 107 dose was well tolerated by the first cohort, which is reassuring for such a novel cell therapy, and the second cohort started enrolling in May (Exhibit 9).

Exhibit 8: MaxCyte’s CARMA pipeline
Source: MaxCyte
Exhibit 9: Phase I trial design with MCY-M11 in ovarian cancer or peritoneal mesothelioma
Source: MaxCyte

The MCY-M11 Phase I trial is expected to complete in H120 and we also expect that first detailed data from the trial will be published during the same period, providing the first indication of the true potential of the CARMA platform. Having said that, at the Capital Markets Day, Christina Annanziata MD PhD, the Principal Investigator for the current trial, emphasised that CARMA is a true platform technology with broad opportunities, for example by producing CARMA therapies that target more than one protein expressed by tumour cells.


Valuation and financials

We continue to value MaxCyte at £195m or 341p per share as described in our Update note dated 24 April 2019. Throughout our valuation we use conservative assumptions, and we still value the company at £111m if we exclude the potential of CARMA. This compares to the current market cap of £73m, suggesting the market does not recognise the value of MaxCyte’s core flow electroporation technology, which is a key enabler for so many cell therapies currently in development.

There are no changes to our estimates. We continue to forecast that the company will grow at a CAGR of 21.6% over the next three years, while achieving a gross margin of 88%. We estimate that MaxCyte’s cash position at H119 was $21m following the capital raise of £10m (c $13m gross) in February, which provides a cash runway for operations into H220.

Exhibit 10: Summary of financials
Source: Company, Trinity Delta  Note: Adjusted numbers exclude exceptionals.




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