OncoSil Medical Ltd (ASX:OSL) has been receiving some strong broker attention recently, as the company moves closer to commercial revenue.
OncoSil last traded at $0.14. The following are extracts and valuations from the broker reports.
Quick wrap of targets:
- Wilsons Research $0.48 per share.
- Bell Potter $0.33 per share.
- WilsonHTM $0.48 per share.
- Van Leeuwenhoek (earlier in year) $0.80 per share.
Latest report from Wilsons Research
IDE trial approval sets the scene for evidence development and commercialisation
The US Food and Drug Administration has granted OncoSil Medical the clearance it needs to start testing its medical device for the treatment of pancreatic cancer in US patients.
The OncoPac-1 Study is a major set piece for OncoSil, designed to secure US market access and drive clinical adoption elsewhere.
An Investigational Device Exemption (IDE) approval is a profoundly validating event for the company, in terms of proving that it can work well with major regulators to progress the development of medical device assets.
The study itself is first rate from the design perspective – it’s a tough study, it asks the correct clinical questions and it has a good chance of detecting any clinically meaningful signals.
We maintain our price target at 48cps. We rate OncoSil a SPECULATIVE BUY.
Key points
FDA approval to commence US clinical trial.
Months of collaborative work with the FDA has been rewarded with OncoSil Medical’s clearance to start testing OncoSil™ in human subjects with locally advanced, unresectable pancreatic cancer.
The OncoPac-1 study is the company’s major clinical set piece over the next 3-4 years, designed to secure US market access and drive adoption elsewhere.
The study design is as we expected: starting with a 20 patient safety “run-in” phase, before opening up to a randomised, open-label, pivotal trial targeting 300 patients, which on our calculations is enough to assess the level of anticipated efficacy in a statistically meaningful way.
The trial has chosen a clinically relevant comparator, too, in the gemcitabine/abraxane regimen, which is the US standard of care.
The primary endpoint of local progression free survival (PFS) is a registrable outcome with supportive secondary measures including PFS, overall survival (OS) and pain relief.
Project costs and timing.
The FDA has added a lot of value in informing OncoSil’s approach to OncoPac-1 in terms of patient safety, physician/endoscopist training, tumour stratification, procedural contingencies and the objective measurement of endpoints.
We are expecting good recruitment rates as a result and view a two-year estimated enrolment period as achievable.
Primary and secondary endpoints may be assessable by 2019, supporting a US approval in 2021, which is consistent with our forecasts and valuation basis.
CE Mark next.
OncoSil remains confident of near-term approval to start selling OncoSil™ in Europe. CE Mark, if attained, will provide both further technology validation and modest revenues.
The decision to invite European centres to participate in OncoPac-1 is smart, enabling practitioners to try the product under the guidance of a controlled protocol and be participants in the academic exercise.
If successful, OncoPac-1 could be a landmark study in interventional radiology for pancreatic adenocarcinoma.
Valuation.
We use a risk-adjusted discounted cash flow model to value OncoSil. Our price target is set with reference to our DCF valuation.
OncoSil remains a Speculative stock with a high risk/return profile.
Un-risked valuation (three-year view, clinically de-risked) is $2.75 per share.
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