Why IMU is a multi multi bagger, page-11639

The World Economy, Imugene and the week that was

This week world markets reacted with uncertainty as the Federal Reserve’s key inflation reading increased a larger amount than expected, dashing hopes of a pause or pivot in ongoing interest rises over there. Inflation may well be slowing though, given the fact there is often a lag between interest rate rises and a slowdown in economic activity. In addition to the housing market cooling, leading indicators such as tech layoff’s are pointing to a slow down in the US labour market, though the US consumer is holding firm, with retail figures in January still relatively strong. The Fed continues to walk a fine line between staving off a recession in the US, or dipping their toes into one. If wages push up due to a stronger than anticipated labour market, inflation may remain stubbornly strong throughout 2023, leaving the FED with no other option than to continue raising rates to combat inflation. However the overall consensus on Wall Street appears to be that only three more .25 basis point rises in the cash rate are required to tame the inflation beast, and in doing so lead to a soft landing in the US. Unfortunately in Europe the situation is a little bleaker given their close proximity to the war in Ukraine. The reliance these economies place on Russian oil and Ukrainian food and fertiliser has resulted in supply chain shortages, increased food and energy prices, cost push inflation and further rounds of interest rate rises throughout Europe.

In other words the Ukrainian War isn’t doing the European economies any favours. Australia appears to be travelling in a somewhat better position given our dependence on the newly reopened Chinese economy, and their passion for iron ore and coal, both of which are in strong demand. Perhaps lithium, cobalt, nickel and the battery revolution can kick the can for Australia in years to come, now we’re no longer riding on the sheep’s back. It would be good if manufacturing and indeed our service industry could take some of the weight, though high relative wages and taxation rates in the land down under make investment here rather cost prohibitive for multinationals.

What does this all mean for Imugene? Not much. Imugene is in the development phase of their business cycle and as they are not a manufacturer or marketer they are reliant on successful clinical tests results for their products to drive growth and price momentum. Swings and roundabouts in the world economy may have an impact on their share price from time to time, but in essence it’s all about producing drugs that exhibit signs of efficacy from here on in. Drugs that can extend the life of cancer patients in a safe environment with minimal side effects. If Imugene’s vaccines can stimulate the immune system to fight off cancer down the track for patients and keep it from reoccurring, then that’s an added bonus. The other triggers for share price growth could come from the need for Big Pharma to move quickly in order to enhance their own dwindling vaccine pipelines or alternatively fend off regulatory pressure from the democrats to reduce the cost of their existing drugs. Senator’s Warren and Sander’s in the US are placing pressure on Big Pharma to reduce costs and adhere to patent laws over there to keep anti competitive behaviour under control. This patent, political and pricing pressure on Big Pharma could lead to increased interest in Imugene, or even a commercial deal, though as of yet there are no signs of this occurring. For now Team Imugene is all about more and more FDA approvals, increasing the patient intake in existing and future trials, whilst at the same time ensuring there are enough funds in the bank to make it all happen.

imugene Clinical Trial developments and IMU share price triggers in 2023

So how are Imugene’s clinical trials progressing, and what does this mean for the IMU share price in the ensuing months? Look to be honest I know long term IMU holders have been saying this for some time now, but we are coming to the pointy end of the stick. I realise it’s been a long time coming, but clinical trials for Imugene’s leading drugs, Her Vaxx, CF33 and Vaxinia are coming to a head.

Her Vaxx

The Her Vaxx Next Herizon Phase 2 Trial follows on from the Her Vaxx Phase 2 Herizon trial wherein OSR were read out in June 2022 and featured at the ASCO Conference in late 2022. In short the results were outstanding highlighting an extension of life by approximately 6 months over the existing standard of care for gastric cancer patients. The Next Herizon trial is Imugene’s first combination trial and having commenced in early September 2022 the Phase 2 trial seeks to treat patients who have failed on previous treatment arms including the Herceptin/Keytruda standard of care. Her Vaxx is combining in this Phase 2 trial with Merck’s pembroluzimab (i.e., Keytruda). Her Vaxx as you may be aware is theoretically designed to “get the cancer patients tumours hot again so they are identifiable and treatable by the checkpoint inhibitor pembroluzimab.” Although Her Vaxx’s initial Overall Survival Rates were excellent when combined with chemotherapy, Imugene CEO and Managing Director Leslie Chong hopes that with the addition of pembroluzimab, the overall survival rates in their Next Herizon trial should spike up even further. To Imugene’s advantage the Her Vaxx /Keytruda Next Herizon combination trial is being administered to some earlier stage patients than those in the initial Phase 2 trial, whilst the Next Herizon trial patients are being administered Her Vaxx at twice the dosage rate of those in the initial Her Vaxx Herizon trial. Therefore the much anticipated increased antibody production within Next Herizon patients could result in increased immune responses and an increased likelihood of stronger clinical trial results.

The Next Herizon Combination Clinical Trial with Her Vaxx and Pembroluzimab is now close to six months in. I would anticipate the first data to read out on this trial in either late Q1 this year if not in Q2. In my opinion any signs of efficacy in conjunction with safety in this Phase 2 Trial would add approximately US $1BN in 2023 to the IMU share price given the safety concerns surrounding Pembroluzimab (i.e., Keytruda) in it’s stand alone form, in addition to the fact the existing Keytruda patent owned by Merck expires this decade. Keytruda biosims are becoming more and more valuable by the day, however few combinations could have the low price tag, outstanding safety record and potential antibody production a combination with star of the recent ASCO Conference, Her Vaxx, potentially has.

Photo courtesy of www.*.com.au

Vaxinia

People talk about a competitive landscape but no oncolytic virus in the world to date that has shown any signs of efficacy when administered to cancer patients intravenously (IV). Enter Professor Yuman Fong’s potent parental oncolytic virus, successful pre clinically against all cancer lines in the NCI60. On February 2 of this year Vaxinia cleared cohort 2 of both the intravenous (IV) and intratumoral (IT) arms of the monotherapy trial, allowing it to open cohort 1 of the combination study (with Pembrolizumab) and cohort 3 for both arms of the monotherapy dose escalation. At the time Imugene MD & CEO Leslie Chong said: “Early data arising from our patients dosed at low levels with our CF33 oncolytic virus have indicated immune activation is occurring in the tumour microenvironment, turning the tumour from ‘immunologically cold to hot’. This is a perfect time to introduce an immune checkpoint inhibitor such as pembrolizumab”, she said. For those new to Imugene Vaxinia founder Yuman Fong is on record on US TV saying he is convinced one day the Imugene licensed oncolytic virus shall one day become human therapy.

Given the last cohort of the Vaxinia Trial was cleared in two months I would anticipate data on the Vaxinia Pembroluzimab combination in Q2 of this year. Any additional signs of efficacy in that cohort of the trial would underpin a US $2BN valuation for IMU in my opinion (see my recent posts for data on the nature and size of the solid tumour market). Often termed the “Wonder Drug”, Professor Fong’s oncolytic virus targets, hunts down and obliterates solid tumours, and has the potential to combine with not only checkpoint inhibitors such as Keytruda, but with a plethora of CAR T cells and allogenic therapies in the fight against solid tumours in cancer patients.

Photo courtesy of www.imugene.com

CF33

Beginning as far back as October 2021 the Phase 1 Clinical Trial of the Professor Fong designed Imugene licensed CF33 oncolytic virus treating TNBC patients at the City of Hope Cancer Research Facility has progressed unimpeded at the behest of the FDA through now three cohorts of patients. These patients, previously having failed on all other treatment arms when afflicted with triple negative breast cancer (TNBC), had a poor prognosis when it came to estimated survival rates. Initially the trial was only allowed to administer very low doses of CF33 to patients, though now with the initial trial patients cleared of all safety concerns trial supervisors are free to administer CF33 at higher dosage rates, hence the Phase 1 clinical trial is soon to enter what we term the “sweet spot” with respect to dosage rates. If the forthcoming stage of the trial exhibits signs of efficacy in what are predominantly very sick cancer patients there is sure to be a strong push from oncologists, medical practitioners and perhaps even the regulators in the US to pressure the FDA into approving a fast tracked registrational trial for CF33. City of Hope’s Cancer Research Facility is sure to have a huge amount of pull with the FDA, health authorities, politicians and regulators in the US. prnnewswires.com reported on February 16 this year that City of Hope, one of the largest cancer research and treatment organisations in the United States, announced that its comprehensive cancer center had received the highest rating possible for a U.S. cancer center — "exceptional" — by the National Cancer Institute (NCI), the federal government's principal agency for cancer research and training. The ranking puts the center in the top echelon of the nation's 53 NCI-designated comprehensive cancer centres.

In my opinion the potential fast tracking of CF33 through to a registrational trial and administration by oncologists and medical practitioners throughout the US would add potentially billions of USD to the IMU bottom line. It would appear Imugene (IMU -ASX) may have already envisioned such a dramatic development by entering into a strategic partnership with ABL in October 2022 for the manufacturing of their oncolytic viruses. One anecdote I took away from a discussion I had with Yuman Fong during his recent visit to Australia was the ability of his viruses to prove effective at relatively low dosage rates pre clinically. That factor is often not taken into consideration when assessing the long term value of his product(s). For if and or when these oncolytic viruses are approved by the FDA for human consumption there exists the opportunity for their ultimate manufacturer to mass produce them at scale for supply at comparatively low input costs, in contrast to existing cancer treatment drugs. Professor Fong of the City of Hope Cancer Research Facility is soon to visit Australia again as part of an Imugene Roadshow, at which time we the investors may learn more of CF33’s current clinical trial developments in addition to future plans for both CF33 and Vaxinia.

Keep in mind CF33 is not a stand alone “one trick pony” as it were. CF33 has already shown signs of significant tumour killing when combined with Car T and allogenic therapies in the Imugene licensed Oncarlytics platform developed once again by the City of Hope Cancer Research Facility in the US. Imugene has announced in their pipeline timeline they plan to administer human patients in a CF33 Oncarlytics Clinical trial this year. From a personal perspective I would not rule out Imugene developing or licensing their own Car T or allogenic therapy. If, and I stress only if this were to eventuate it would negate the need for Imugene to out license their oncolytic virus products CF33 and Vaxinia to third party providers such as Novartis, Abbie V, BMS and Amgen, potentially keeping the lucrative solid tumour market all to themselves. Such a strategic move, even if it were to happen as early as 2023, in my opinion would add billions and billions of USD in intrinsic value to the imugene portfolio. Once again this outcome is purely speculation on my part.

Pd1 Vaxx

Her Vaxx, the oldest vaccine in Imugene’s B Cell platform is destined to combine with the Pfizer Merck Germany owned Avelumab in 2023, in addition to the Her Vaxx Pembroluzimab combination trial outlined above. Outside of Her Vaxx the Imugene licensed PD1 Vaxx forms an integral part of the company’s B cell platform. Imugene has entered into a supply agreement with the leading pharmaceutical company Roche to enter a combination trial for PD1 Vaxx with their successful Tercentriq drug, with a view to treating and extending the lives of lung cancer patients. Thousands upon thousands of individuals are diagnosed with lung cancer each year, and PD1 Vaxx has already been shown to have extended the lives of such patients in a recent Phase 1 Clinical Trial conducted in Melbourne, here in Australia. With all this in mind the forthcoming announcement of the first patient being dosed in the PD1 Vaxx Tercentriq combination trial could act as another trigger for the IMU share price to react positively from in 2023.

AI, bots, manipulation and management

As artificial intelligence evolves in the years to come stock manipulation through social media, share trading platforms and mainstream media is set to become more prevalent. We are already seeing chat bot freaks on Hot Copper, multiple bot and algorithm machinations on the ASX market and the return of meme stocks through rednecks on portals such as Reddit. I guess the best we as investors can do is keep divining the fundamentals of each stock in which we choose to invest. Having performed your due diligence keeping clear of the background noise is

important. I find myself wading from time to time through reams of disinformation when it comes to IMU.

Imugene is a stock in which all the leading directors and managers are significantly if not fully invested, including but not limited to Paul Hopper and Leslie Chong. One would assume Leslie has extended herself financially to participate in the growth of Imugene, through the conversion of options. As such I would be confident in saying few people would want the share price to move more than her. Therefore when stones are thrown from left field at management keep in mind they are in the same boat as you and I as investors. Yes their salaries are paid irrespective of the daily share price movement, but in the end their own positions are dependent on the IMU share price performance, as is their personal wealth. At times I have been critical of the company’s shortcomings in the area of media, communications and marketing, and their apparent lack of a pathway to commercialisation. Though as you can comprehend these are simply my opinions, at the end of the day we all need to appreciate management are working tirelessly to progress clinical trials, deliver better patient outcomes and create value for shareholders. I remain more confident than ever, as illustrated throughout this article, a realisation of their corporate and social goals is upon us in 2023.

DYOR - Seek investment advice as and when required - Opinions only

P.s Thanks for all the kind comments from my followers here on this thread. They do not go unnoticed. As Michael J. Fox alluded when receiving the Jean Hersholt Humanitarian Award recently at the Oscars, gratitude helps fuel our optimism (see herein). And your gratitude indeed goes a long way toward driving my optimism that one day Imugene, and indeed Michael J Fox, may conquer their collective quests to cure some of the world’s deadliest diseases. …Enjoy what’s left of your weekend.. WMHB