CHMO expires 31 March 2024 with a strike price of 25.5c
My take on options for biotechs is quite simple. They provide cheap leverage. For a relatively small outlay (compared to the heads), CHMO gives me full access to any upside over the next 24 months where CHM's market cap goes above $100m (approx. 25.5c per share).
Time value can be quite substantial when you have 2 years in what is a high potential biotech which can see the valuation easily jump 10x in that time period.
CHM has several shots on goal, with CLTX across GBM, melanoma, colorectal and prostate. GBM is obviously most progressed, and realistically by Mar 2024 they will have finished the phase 1 trial, including the expansion cohort. At that stage, if the data is as good as we hope it will be, then IMO the most likely outcome will be for CHM to at least survey the big pharma landscape and see who would like to partner or acquire the asset.
We also expect the melanoma, colorectal and prostate phase 1 clinical trial to initiate in 2022, so we will get some readouts prior to Mar 2024. But the phase 1 may not complete by then.
CDH17 targeting neuroendocrine, colorectal, pancreatic and gastric cancers. This is looking like a 2022 initiation, with readouts throughout 2023 into 2024. With what looks to be very promising preclinical data, this could really surprise and similar to CLTX, be in a position to partner or be acquired in 2024 if not 2025.
Viralytics was acquired for A$500m back in 2018, and Imugene is worth north of a billion. CHM could very well be in a similar stage in Mar 2024, where only one more trial required (phase 2) before FDA filing. Currently sitting at around $55m market cap. 10x in 24 months is very much possible IMO.
Core-NK & CAR-NK targeting several blood and solid tumors. But I'd say these assets may only hit the clinic in 2-3 years, so I don't expect these assets to contribute greatly to where the share price will be by Mar 2024, but incremental value will be attributed as progress is made in firstly developing and them reading out preclinical data using these newer platform NK assets.
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