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Allergy Therapeutics' results not to be sniffed at

The phase II trial assessed the response from 371 patients, which revealed a statistically significant dose-response relationship from the groups receiving the medication.
Dandelion seeds scattering in the wind -meant to represent pollen.
The company's Pollinex platform is proving effective across a range of pollens.

Allergy Therapeutics plc (LON:AGY) described as “very encouraging” the results from the latest clinical study of its PQBirch204 treatment for hay fever caused by birch pollen.

The phase II trial assessed the response from 371 patients, which revealed a statistically significant dose-response relationship from the groups receiving the medication.

Allergy said the latest clinical data “reaffirmed the potential” of the company’s Pollinex platform to treat the different variants of allergic rhinitis.

Researchers also found that PQBirch204 was safe and well tolerated, while 94% of patients stuck to the dosing guidelines.

It is expected a phase III study will get underway early next year.

"The results of the PQBirch204 trial are very encouraging and they reaffirm the potential of our Pollinex platform to treat the underlying cause of allergic rhinitis,” said chief executive Manuel Llobet.

Is Allergy undervalued?

The shares, up 28% in the last year, were ahead a further 3% in early afternoon trade at 26.37p.

There is further for the stock to go, according to Panmure Gordon’s Dr Mike Mitchell.

He says the market is applying an “unduly onerous” discount to the Allergy shares, which he values at 53p.

“In itself the outcome for the Birch programme paves the way for late-stage development of that programme on track and, on a qualitative basis, the news potentially reflects an important de-risking factor for Allergy Therapeutics’ wider platform,” Mitchell said in a note to clients. 

Profitable and growing strongly

Allergy Therapeutics has a profitable core business and, as the name suggests, a number of ground-breaking allergy vaccines that trade under various brand names. Its most commonly prescribed vaccines are used to treat pollen-related allergies, particularly allergies to grasses and trees.

It has has a strong presence in Europe with established operations in Germany, Italy, Spain, Austria, Switzerland, the Netherlands and the United Kingdom, while in other markets it often makes its products available through distribution partners.

Its Pollinex Quattro vaccine for the treatment of seasonal allergic rhinitis from grass, tree or ragweed pollen allergy is already established in Europe, and the board is confident the success can be replicated in the US, where it will enjoy first mover advantage in a market potentially worth $2bn.

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