Bit gun-shy on sharing my views due to the inevitable backlash, but you’re constantly generous with your material, so happy to share in this case.
Short Answer
Dose escalation is only about safety and tolerability and possibly some initial observations about the action of the drug. It has nothing to do with efficacy. There is a massive potential downside to Phase 1 trials - ie if they prove the drug to be unsafe or intolerable its a disaster. The upside is only that the company will be able to proceed to a Phase II trial in which efficacy will be measured. Being able to progress is of course a good thing, but that’s all it is. It's not a significant value inflection point. Flippant as it might sound, this announcement just keeps VAXINIA in the orange juice category - ie its not harming the patient and IMU is free to test higher concentrations, but there is nothing that can be said about its efficacy in treating cancer.
So I’m not surprised that the price didn’t shoot up on this announcement.
Longer Answer
Let's go with the company’s own stated positions of:
1. Having no intention of proceeding to a registrational trial with anything; and
2. Believing that BP shows interest in small biotechs at the conclusion of successful Phase II trials.
On this basis, in some respects IMU is further away from a significant value inflection point than it was two years ago. Back then we had the release of what seemed like strong efficacy data for HER-Vaxx. The interim results looked good (albeit there were a couple of views about the one-sidedness of the trial, the p-value achieved and the small sample size), so good that Leslie expected a number of approaches from BP (full dance cards etc ..). It then appeared to be reinforced by the IDMC who called an end to the trial on the basis of ethics.
Fast forward two years and (to me at least) it becomes clearer and clearer that HER-Vaxx is a duster. Since then, the interim results have been confirmed, but:
- there’s been no explanation about how its ethical to deny every cancer sufferer (even the potential remaining patients on the trial had it been extended to the original 68) access to HER-Vaxx;
- there’s been no initiative to proceed to a registrational trial of HER-Vaxx;
- there’s been no interest from BP.
HER-Vaxx is now (apparently - I have a suspicion that it may not be further progressed even in combination) back to the start of Phase II and all other products are either in Phase I or pre-clinical. So if a value inflection point is based on BP purchasing a drug that has shown sufficient efficacy in a Phase II trial, IMU is further away from that point than it was 2 years ago.
So many respected posters on this site (
@Steini "we all know by now how great Her-Vaxx has become",
@davybabyk,
@Owl vs Fox,
@Watmighthavben - ps: every failed biotech had 50 Top-50 shareholders that thought the company was undervalued
- and even yourself) regularly post that “the fundamentals have only gotten better”, but at least with HER-Vaxx I can’t see how that’s the case.
We can keep debating whether the p-value was sufficient, whether ending the trial early was an ethical decision or a commercial one, whether a BP pulling our of even a paltry drug supply agreement was significant or otherwise, but the good news is that we have an independent umpire. Its name is BP and two years after the interim results were published (and they have only been confirmed since then) its decision is clear - we’re not buying IMU, we’re not buying HER-Vaxx, we’re not funding a combination trial with HER-Vaxx, we’re not even going to release a press statement saying that we’ve supplied some of our own product and are looking forward to the results of a combination trial funded by IMU.
That’s the bad news and to me that explains why even at its current SP, the valuation of IMU is steep. Its why I hold less than 1/3 of my original holding and why I regret being seduced by the dance cards full routine and the IDMC proclamation for as long as I was. And before the muppets with the "why do you hold" or "why don't you sell and piss off" ask - three reasons: (a) my HER-Vaxx analysis could be wrong; (b) one of the other drugs might be a winning lottery ticket; (c) its a free carry.
There is some good news.
I've come to the view that Paul Hopper realised pretty early in the piece that the HER-Vaxx results were not strong enough to interest BP, so he did two things:
1. He took some money off the table for himself;
2. He raised $100m.
The second action seemed like a rip off to existing shareholders (including me) at the time but it allowed IMU to purchase the rights to and / or progress trials in other products. Were it not for that, I think IMU would be worthless today.
One of those products is VAXINIA, so any progress with it is good. Same for PD1-Vaxx, CF33 etc .. I just think shareholders need to be aware that these products are years away from Phase II and even more years away from concluding a Phase II trial and proving efficacy. Progressing through dose levels at Phase 1 is just a small stepping stone, not something that should rationally add hundreds of millions of dollars to IMU’s valuation.
Its also why I think that trading is the only way to make money from IMU in the short to mid term - hence my admiration for
@slick, and my confusion (given the time and effort you put into charting) as to why you don't do the same ...
GLTAH.
(20min delay)