Avacta Group “Affimers First-Class Prospects” says Zeus Capital

Avacta Group
[shareaholic app="share_buttons" id_name="post_below_content"]

Avacta Group PLC (LON:AVCT) is leveraging the antibody-like properties of Affimers for Therapeutic and Diagnostic applications across multi-billion dollar markets, including testing and treatment for COVID-19, building a differentiated pipeline and global partnerships. The near-term key is the roll out of its SARS COV-2 antigen tests, including potentially one of the first Point-of-Care tests to-market, offering game-changing commercial scope, sufficient to significantly accelerate the clinical development of its Therapeutic pipeline.

  • Collaborations; in FY19 AVCT formed partnerships to progress Affimers in a range of highly promising therapeutic applications, including with ADC Therapeutics, and set up a 48% owned JV with Daewoong Pharma. Moderna exercised its option on a first Affimer target. We estimate these collaborations plus its partnership with LG Chem Life Sciences, present aggregate milestones up to $0.5bn plus future royalties, and crucially, they cover R&D costs of taking first Affimers into the clinic.
  • Diagnostics; the division has a late stage pipeline addressing markets with projected value up to $18bn. Affimer-based assays can potentially displace market share from antibody equivalents, largely unhindered by IP. The ability to rapidly generate Affimer reagents against SARS-COV 2 showcases the characteristics of Affimers for Diagnostic use. Even by capturing a small share of the estimated millions of tests per day needed globally to bring COVID-19 under control to help people safely resume normal activities, provides game-changing commercial scope; we estimate annual sales up to $2bn at scale.
  • Novel Technologies; AVCT is focused on clinically validating its novel pre|CISION platform based on technology licensed from Tufts University School of Medicine, through a trial start for the first candidate AVA6000 in the next 12-months. Initially this can multiply up the $1bn market for standard chemotherapy doxorubicin on which AVA6000 is based, as well as improve other established chemotherapies. pre|CISION technology is also being used to generate a potent new class of Affimer Drug Conjugates called TMACs. This combines the Affimer and pre|CISION platforms in a single drug synergising the potency of chemotherapy with immunotherapy and can build on the hugely promising field of Antibody Drug Conjugates, predicted to exceed $9bn by 2025.
  • Avacta Group has promising Therapeutic and Diagnostics pipelines; we suggest a base case valuation of AVCT of £290m. There is clearly enormous upside from a successful rollout of SARS COV-2 tests. Even executing a fraction of this potential in FY20 would be transformational, providing cash resource to advance its promising Therapeutics pipeline. Applying market metrics it also implies that a £ multi-billion valuation of AVCT is achievable on execution.

We’ll keep you in the loop!

Join 1,000's of investors who read our articles first

We don’t spam! Read our privacy policy for more info.

Twitter
LinkedIn
Facebook
Email
Reddit
Telegram
WhatsApp
Pocket
Find more news, interviews, share price & company profile here for:

Search

Search