Kazia Therapeutics Ltd (ASX:KZA, NASDAQ:KZIA)’s upcoming top-line data for EVT801, an inhibitor of vascular endothelial growth factor receptors (VEGFR), in H1 CY23, is expected to be a key share price catalyst according to Edison Investment Research.
Edison has released a development update on Kazia following the publication of pre-clinical data for EVT801 in the journal Cancer Research Communications.
The research firm’s valuation for Kazia has changed slightly to $143.9 million or US$8.81 per basic ADR (current ADR price: US$0.57), reflecting the additional shares issued under the at-the-money (ATM) facility.
The following is an extract from Edison’s development update:
Kazia Therapeutics has announced the publication of pre-clinical data for its second pipeline asset, EVT801 in the journal Cancer Research Communications. The research was conducted by licensing partner Evotec and was the key driver for Kazia in-licensing the asset in 2021. EVT801 is an inhibitor of vascular endothelial growth factor receptors (VEGFR), which play an important role in angiogenesis and lymphangiogenesis (processes that contribute to tumor growth and metastasis), making VEGFR a well-established therapeutic target. While VEGFR inhibitors have been on the market for over a decade, Kazia asserts that by selectively targeting VEGFR3, EVT801 offers a potent and less toxic therapeutic profile than other benchmark drugs, such as Novartis’ Votrient (pazopanib) and Bayer’s Nexavar (sorafenib). EVT801 is currently in a Phase I clinical trial with initial data expected in H1 CY23. Our valuation changes slightly to $143.9m or US$8.81 per basic ADR, reflecting the additional shares issued under the at-the-money (ATM) facility.
A specific inhibitor of VEGFR3
The VEGFR family of proteins are receptor tyrosine kinases and in cancer are implicated in angiogenesis and lymphangiogenesis. These proteins have been a common target for therapeutics (such as the first-in-class angiogenesis inhibitor Avastin), although fewer efforts have been made to specifically target the VEGFR3 isoform, which is important for the formation of lymphatic vessel networks. Management believes that more selective VEGFR3 inhibition may result in improved drug tolerance and lessen development of resistance to therapy.
Positive pre-clinical data on EVT801
The recently published pre-clinical data (both in vitro and in vivo) demonstrated that EVT801 was able to achieve strong anti-tumor activity in VEGFR3+ tumors even at low (nanomolar) dosages, suggesting a good safety profile and the potential for a wide therapeutic window. The drug also presented higher activity than currently marketed drugs pazopanib and sorafenib in in-vivo mouse models. Importantly, the drug showed synergistic efficacy benefits in combination with checkpoint inhibitors, which highlight incremental potential as a combination treatment.
Valuation: US$143.9m or US$8.81 per basic ADR
We update our valuation for the latest issues under the ATM facility, which we estimate has contributed c US$4m in funds in H123 to date for Kazia. Our revised valuation stands at US$143.9m or US$8.81 per basic ADR. We expect the upcoming top-line data for EVT801 in H1 CY23 to be a key share price catalyst