Analysts at Dawson James Securities said Friday that Dyadic International Inc (NASDAQ:DYAI) is “chock full” of opportunities citing the company’s effective strategy which is to pursue license and royalty structured deals across several focus areas.
The boutique investment bank currently has a “Buy” rating and $14 price target for Dyadic, which currently trades in the $5.70 range.
In a note to clients, Dawson James analyst Jason H Kolbert said the Jupiter, Florida, biotechnology company closed the third quarter with $37 million in cash and plenty of catalysts.
“Dyadic reviewed all the progress in the period, and we took note of a few key points: 1. Additional collaborations are underway, such as the one announced in the animal health space,” said Kolbert.
“Secondly, the company spent $1.6 million in the quarter and ended the period with $37 million in cash and equivalents, which means it has plenty of runway to drive towards its next collaboration/monetization event. Thirdly, Dyadic is chock-full of catalysts,” said Kolbert.
The analyst created an exhibit of upcoming catalysts for the company in the shape of additional collaborations with pharma, biotechnology, biosimilar, and industrial companies, and opportunities in the large AAV vector and vaccine market.
“Previously licensed to third parties, such as Abengoa Bioenergy, BASF, Codexis, and others. C1 is now poised to branch out into the biomedical market, aiming to develop products such as innovative vaccines and drugs, biosimilars and biobetters,” said Kolbert.
Tapping the large vaccine market
The analyst also highlighted Dyadic’s opportunity in the large vaccine industry.
“Dyadic currently has a partnership deal (milestones and royalties) with the Serium Institute of India. The arrangement allows Serium to select up to 12 additional projects,” said Kolbert.
The research and commercialization collaboration agreement with Serum Institute of India is for the development and manufacture of up to 12 antibodies and vaccines using Dyadic's C1 gene expression system. Dyadic has agreed to grant Serum the option to obtain an exclusive commercial sublicense for each of the proteins expressed from its C1 technology. In return for these sublicenses, Dyadic will receive research funding, milestone payments, and royalties for 15 years from the date of the first commercial sale.
“We assume that the rising demand for cheaper, and faster, production of vaccines only continues to rise with time,” said Kolbert. “The global need is great, and in emerging countries, cost-effective production is critical. As Dyadic demonstrates success in the industry we expect additional vaccine makers will utilize the C1 platform.”
A proven model from humble beginnings
The analyst said Dyadic’s C1 gene expression platform specializes in enzymes and protein production more efficiently than competing methods.
“Starting out as a gene expression platform for the production of commercial quantities of industrial enzymes and proteins, C1 has proven to have the ability to produce greater quantities of enzymes and proteins in large quantities with high priority all while maintaining a relatively low cost,” said Kolbert.
Dyadic leverages its proprietary C1 expression system — a fungal expression technology for producing enzymes — to help bring biologic vaccines, therapeutic enzymes, proteins, biosimilars and drugs to market faster and at a lower cost.
Dyadic has patented its proprietary filamentous fungus, Myceliophthora thermophila, and the associated molecular tools used to engineer the C1 cells to express and manufacture large volumes of low-cost biologic products such as enzymes and proteins. The C1 fungus is a living cell that has been bioengineered by Dyadic scientists for more than two decades.
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