Imugene Ltd (ASX:IMU, OTC:IUGNF)’s chairman says the company is “as strong as it has ever been in its history” despite challenges in the global biotech market.
In a letter to shareholders, Aussie bio-entrepreneur Paul Hopper said the company was financially secure and continued to thrive, notwithstanding changes to the share price from last year’s peak.
Looking ahead, Hopper encouraged investors to keep their eyes trained on the company’s pipeline as Imugene pushes ahead with a series of clinical studies.
The chairman highlighted the company’s strong cash reserves and broad clinical portfolio as assets that would help it weather the storm.
Imugene shares are up 13.5% following the letter to A$0.227 per share. The company has a market cap of approximately A$1.3 billion.
What does the market look like?
Hopper said it was an understatement to say the biotech industry is living in turbulent times.
“Since December last year, biotech share prices have fallen dramatically,” the chairman explained.
According to Bloomberg, April was the worst month on record for US biotechs since at least 1997 and the sector has tumbled roughly 65% from its February 2021 peak, sinking 22% in April alone.
“In addition, investors around the world have been spooked by the Ukraine-Russia tensions, hawkish comments from the US Federal reserve, stubborn inflation and a worsening COVID situation in China,” Hopper stated.
Alto Capital’s Tony Locantro also believes biotechs are missing the love.
In an interview with Proactive last month, the stock market commentator broke down how global volatility had hit the industry.
While the instability has impacted IMU’s share price, Hopper says the company remains one of the largest three biotechs in Australia today.
“Storm in a teacup”
Hopper’s letter comes soon after some shareholders were spooked by the end of Imugene’s supply agreement with MSD.
Earlier this month, the company announced the deal had been terminated, but that it was still going ahead with its HER-Vaxx clinical trial as planned.
While it didn’t outline why the deal had concluded at the time, Imugene reassured shareholders the reasoning had nothing to do with its technology, clinical trial design, study data or safety, and that alternative supply arrangements were available.
Since then, Hopper said the company had a number of shareholders reach out regarding the supply agreement’s cancellation.
“The reaction to this has been out of all proportion to the news, and is really a storm in a teacup,” he said.
“We recently announced that this trial is open ahead of schedule and can be expedited by obtaining the drug elsewhere, the cost of which is not material.”
What is Imugene out to accomplish?
Although the market remains turbulent, Imugene is pushing ahead with work across its clinical pipeline.
“Imugene is as strong as it has ever been as we continue to make good progress,” Hopper reassured in his letter to shareholders.
The chairman went on to spotlight some of the company’s investment highlights, which he believes are its strong cash reserves, with A$100 million in the bank, and three platform technologies supporting six unique assets.
Within 12 months, the biotech expects to have roughly 10 clinical studies on the go, supported by between five and six Food and Drug Administration Investigational New Drug approvals.
Imugene’s drugs are targeting more than 10 disease areas and the company has two supply agreements with leading pharmaceutical companies, as well as two industry/scientific collaborations.
What’s on the horizon?
Imugene’s chair said the rest of 2022 has some “exciting developments” in the pipeline.
Planned activities include:
- Trialling the HERVaxx combination in two phase-two studies; one with BAVENCIO® (avelumab) and the other with KEYTRUDA® (pembrolizumab) in gastric cancer;
- The final readout of the HERIZON HERVaxx study; and
- Trialling PD1Vaxx in combination with TECENTRIQ® (atezolizumab) in lung cancer;
Imugene is also in the middle of some key clinical milestones.
The company’s CHECKvacc drug candidate is already in cohort two with some interesting data reported as early as cohort one.
Meanwhile, Imugene’s VAXINIA oncolytic virus has commenced dosing in patients, as reported to market late last week.
Finally, onCARlytics — IMU’s oncolytic virus that expresses CD19 — is awaiting publication on the combination with Celularity and Eureka CAR-T therapeutics.
The bottom line
Rounding out today’s note, Hopper remained optimistic about his company’s future.
“Imugene is in immune-oncology therapies with a rich pipeline and prospects. We are financially secure and will continue to thrive," he concluded.
“We both remain, and will continue to remain, large shareholders in IMU and are firmly committed to the company and the exciting times ahead.”