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5.3¢ imugene limited

Ann: Imugene Licenses Allogeneic CD19 CAR T Cell Therapy, page-432

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Hrdwk

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21/08/23

08:16

Post #: 69446923
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Originally posted by Watmighthavben ↑

The Precision Deal
Thanks @sookycoopoops for asking me to post my opinion on Imugene’s recent Azer-cel acquisition and their decision to acquire the lease to a 32,800 square foot GMP manufacturing facility in North Carolina. As you are no doubt aware the deal includes drug material for the completion of a Phase 1b Azer-cel clinical trial together with an experienced cell therapy and manufacturing team of approximately 50 personnel. I believe this is a sound business decision complimentary to Imugene’s existing Cf33, Vaxinia and Oncarlytics platforms, and a forthright step toward obtaining revenue producing assets in the near term. Clearly the Azer-cel technology brings with it the huge opportunity to obtain a registrational trial for a CAR T product long before the date possible with either Celularity or Estrella’s technology. As both Blincyto and Azer-Cel have FDA approval, the road to market for Imugene’s promising Oncarlytics arm is closer now than many may have thought possible this time last year. Imugene is no longer reliant on third party CAR T therapies to take their flagship Cf33/Vaxinia and Oncarlytics solid tumours treatments to market. They are in effect masters of their own destiny, having licensed this supercharged allogeneic T cell globally from the US based Precision Biosciences. Furthermore the acquisition reiterates their strong belief in both Cf33 and Vaxinia. For without Cf33 their Oncarlytics platform, whether in combination with either Amgens Blincyto or Precisions Azer-Cel, holds no weight.

Raising capital

Unfortunately I am in total disagreement with the companies timing in seeking yet another capital raise (CR) at this stage in their development. From where I sit they could have waited until later in the current financial year to raise the cash needed to move forward with their global expansion plans. A cash payment of approximately $12.49 million and a deferred consideration of around $20.2 million is required to close the deal. A further payment of $12.59 million will be required on satisfactory completion of the imminent Phase 1b clinical trial. That said Imugene’s last capital raise ensured the company has sufficient funds on hand to secure the said transactions, and at the same time complete all of their existing clinical trial commitments through to 2025. By 2025 the current Cf33 and Vaxinia trial data shall have been well and truly processed, together with fresh readouts from their recently approved Oncarlytics Blincyto combination trial. By waiting until what IMO would be a more opportune time in the future to raise capital, IMO shareholders would have been financially far better off than they are today. At such a time IMU’s share price may well have appreciated, in line with the positive clinical trial data alluded to by Professor Fong. However as it stands, in facing more dilution at a massive discount to the IMU two year trading average, IMO shareholders have yet again been led up the garden path. As with former IMU capital raises there is no guarantee incoming shareholders shall keep their shares post the raise, for from what I can glean there is no escrow period pertaining to these shares. Why is the capital raise at discounted share prices required today? With close to $150 million AUD in the bank and R&D returns ongoing IMO they have ample cash to perform this trade, meet existing clinical trial commitments and keep the wolf from the door before Precision came knocking down the track.

Sell the B cell platform or part thereof

I commend Imugene for thinking bigger picture when it comes to acquiring exceptional technology such as Azer-cel, which has been so successful in treating diffuse large B-cell lymphoma (DLBCL), an aggressive type of non-Hodgkin lymphoma (NHL). Having the ability to manufacture this treatment is a further string in the company’s value proposition bow. But sooner or later the company needs to realise more is less when it comes to returning value to existing shareholders. If they are to continue their strategic focus on oncolytic viruses, in combination with Oncarlytics and Car T programs, then IMO Imugene’s B cell platform, or part thereof, should be sold prior to the dilution of any further shares in the company. A well constructed deal would provide an upfront cash payment in addition to ensuring Her Vaxx’s clinical trial growth and prospective FDA approvals benefit shareholders through milestone payments and future royalties. Keep in mind that although Imugene has extremely valuable intellectual property, which may indeed hold the key to the holy grail of cancer treatment in the future, the BOD has a responsibility to return value to shareholders on an ongoing basis. And by value I am referring to an appreciation in their share price. If Monil Shah can’t secure a deal, outsource it to a third party who can, shareholders are tired of waiting. Investors aren’t seeking a pot of gold for the B cell platform, they are simply seeking a return.

Imugene, Nasdaq and the road ahead

Imugene has consistently made excellent decisions in their acquisition of ground breaking, cutting edge and potentially game changing technology, in order to meet the huge unmet need prevalent within the cancer community today. They have built outstanding relationships with world leading cancer research facilities including City of Hope and Sloan Kettering. They have continued to collaborate with world leading scientists, including Ursula Wiedermann, Pravin Kaumaya, Yuman Fong and Saul Priceman. Yet IMO their ongoing financial reliance on small ball Australian players such as Bell Potter and Bell Potters customers has held them back from a forward looking push into the broader US and European markets. A Nasdaq listing and the subsequent influx of capital and awareness that could have accompanied such a move, may have been far more fruitful for existing IMU shareholders, who appear to be still running with the hares and the hounds at the mercy of Bell Potters beck and call, in search of a brighter tomorrow.

Speaking of tomorrow, that reminds me, “Wake me up, when November comes.” Irrespective of the current SP and stock broker shenanigans, IMO Imugene is the main game in town when it comes to capital growth. I’m still holding out for Noosa and that dollar party you’re invited to. Imugene can now control their own destiny without any third party immunotherapy providers. There products are far more competitively priced than existing cancer drugs. Whilst now they are in a position to manufacture them, how good. Bring on the Vaxinia results, I can hardly wait!

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

P.s. Things to look forward to toward November for capital growth:

Vaxinia Optimal Dose rates and readouts
Cf33 Optimal dose rate and readouts
Her Vaxx/Keytruda readouts
PD1/Tercecentriq readouts
Ist patient dosed in the Oncarlytics/Blincyto Trial
FDA IND for an Oncarlytics/Azer Cell Trial

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Welcome back and a huge thank you. Don’t be afraid to use the ignore button.

IMU Price at posting: 7.9¢ Sentiment: Buy Disclosure: Held
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