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Avacta Group - Rapid Progress of Immuno-oncology Programs

Avacta Group - Rapid Progress of Immuno-oncology Programs

KEY INVESTOR MESSAGES

  • Faster than expected development of the second immuno-oncology (I-O) program, a LAG3 inhibitor, allows company to evolve its lead program into a more ambitious LAG3/PD-L1 bispecific aiming to enter the clinic in 2020
  • Good progress of the ongoing external collaborations in two key areas: gene delivery (Moderna, OncoSec, FIT Biotech) and drug conjugates (Glythera)
  • Expect further licensing deals for Affimer reagents, based on multiple on-going evaluations
  • Stock price weakness reflects in our view uncertainty around a likely capital raise before year end rather than the company's strong fundamentals

 

We have updated our chart showing key milestones expected in the near term for the numerous in-house and external programs. 
 
The initial research phase of the collaboration with Moderna has a natural end point in May 2018; we expect Avacta to potentially announce an extension of this collaboration in the next couple of months or to have transferred an Affimer to Moderna for them to develop.

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Avacta Group PLC Timeline

CN Research
April 09 2019

Related Researches

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April 09 2019

  • Avacta Group PLC (LON:AVCT) reported interim results to January 2019, confirming good progress on key development programmes
  • Lead immune checkpoint inhibitor programmes continue to move towards in-man clinical data in 2020
  • Major development partnership and licence agreement with LG Chem potentially worth more than US$300mln plus royalties, announced in December
  • Post-period end, the additional licensing deal with Moderna provides further validation of Avacta’s Affimer platform
  • Appointment of Jose Saro as the chief medical officer strengthens Avacta’s capabilities for evolving from pre-clinical to clinical
  • The Research and Diagnostic Reagents business reports a record sales pipeline

Avacta (LON:AVACT) reported revenues of £1.0mln, down from £1.5mln the year before, largely due to the absence of research services revenues for FTEs working on the Moderna collaboration now that assets have been transferred into their development pipeline. We expect revenues from the LG Chem deal to offset this during the remainder of 2019.

The company reported a cash outflow from operations of £2.9mln and ended the period with £11.8mln net cash following the £11.6mln fund-raise in August. We believe that Avacta can comfortably fund ongoing development programmes into 2020.

The company will be moving its year-end from July to December, meaning that the current year will be reported on the basis of a

17-month period (see table below).

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July 30 2018

Avacta Group Plc (LON:AVACT) has recently finalised a co-development partnership with Boston-based Bach BioSciences, to exploit the potential of the Affimer platform for the development of a novel class of drug conjugates.

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September 03 2018

Legendary Investments (LON:LEG) creates value through privately held and pre-market investment opportunities with the potential for outsized returns. The company has a strong track record with:

  • Total investments valued at of £6.2mln (from zero in 2011)
  • Out of 12 investees in total, five are exhibiting multiple returns from 1.3x to 35x
  • Two crystallised with exits at a multiple of the initial investment

We believe this is an interesting time to revisit the investment case, as the shares are currently trading at a discount to net asset value (NAV), which has not been the case in the past.

N.B. Legendary plans to change its name to Eight Peaks Group (LON: 8PG) in the near future.

 

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