Roth just rated IMU a buy, page-73

Have just been reviewing again the Roth research.
There is just so much information to absorb if people are only now hearing about Imugene for the very first time.
What stands out is with the 13c valuation price “target” they have most certainly left a wide margin to revise this target upwards as things progress.

p22

“Potentially Lucrative Pre-Commercial Outcome•
We note below several oncolytic virus transactions that reflect the potential value creation that Imugene and its investors could experience well before late stage clinical success.”

and the last example given out of many, being the most recent,
”In 4Q19, Takeda (TAK-NC) partnered with Turnstone Biologics for preclinical Rival-01, a vesicular stomatitis virus for $120 million upfront, up to $900 million in potential milestone payments, and potential royalties.”.
(note, the royalty rate to Turnstone is actually 50% . all the Roth financial modelling is done on licensing Royalties of 15% )

US$120 million upfront equates to a ballpark figure of 2.7c per share dividend to shareholders assuming a 75% payout.

Multiple that by almost 8 times if the $900 million in potential milestones to commercialisation are all paid.

( I use use this Takeda deal purely as a ballpark average.)

Makes the current shareprice look a little weak if that type of licensing deal is achieved.

Personally i I don’t think CF33 is up for negotiation at the current “ pre clinical” stage. Imagine how much better the deal suddenly looks on successful trial data.
However, listening to LC’s recent interviews, the prospect of HerVax being partnered on significant data just gets more and more likely.

And as Roth Capital also agrees in the p.3 investment summary
“ We believe that Imugene would be best served to engage commercial partners for all of its assets that demonstrate clear clinical proof-of-concept, with the potential to market its products itself in Australia, and thus we incorporate royalty revenue from several major markets into our financial model. Delivering partnerships that provide meaningful economics would likely serve as additional significant investment catalysts, as well as supply non-dilutive upfront capital, in our view.”

Sounds strategic to me, no more capital raising required if a partnership deal is struck first for HerVax. Then another for PD1vaxx then another for CF33.

A quick “back of the envelope” calculation on HerVax, Pd1Vax , and CF33 all being partnered separately to the same tune as the Turnstone/ Takeda deal . Combined Upfronts and milestones would see approximately 59 cents per share returned to shareholders on a 75% payout. Plus Leaving a massive pool of cash for working capital to continue development of further combinations or other vaccine targets from the Mimitopes platform.

At current market price, failure across the pipeline is really all that is currently being priced in. Or alternatively, “the market” thinks each of the three deals is only worth a mere fraction of the actual deal sizes that have been going on in the world of Big Pharma and ImmunoOncology deals.