- BiondVax, a biotechnology company focused on developing, manufacturing, and commercializing innovative immunotherapeutic products, was featured in a recent analyst report reiterating a Buy recommendation and a $70 target price
- The report discussed Eli Lilly’s announcement of a definitive agreement to acquire DICE Therapeutics for approximately $2.4 billion as evidence of the potential value of BiondVax in this segment of the therapeutics market
- DICE Therapeutics is currently evaluating its lead drug candidate, DC-806, an oral IL-17 inhibitor, in a Phase II trial, with early-stage results from the Phase I study showing a near-44% reduction in Psoriasis Area and Severity Index
- The report noted that the deal between Eli Lilly and DICE Therapeutics illustrates the potential valuation that BiondVax could receive with positive early-stage clinical results
- Also, revenues from FDA-approved psoriasis drugs show the potential value of the company should its IL-17 NanoAb therapy eventually receive FDA approval
According to Goldman Sachs Research, the global pharmaceutical industry is sitting on about $700 billion in dealmaking firepower, expected to fuel M&A-driven growth as companies look to revamp their intellectual property portfolio as their existing patents expire (https://ibn.fm/7VNq6). Flush with cash, big drugmakers also have easy access to alternative financing, factors that allow them to make aggressive acquisition bids for promising biotechnology companies and other targets (https://ibn.fm/Uo69R).
This played out recently when Eli Lilly and Company (NYSE: LLY) announced it had signed a definitive agreement with DICE Therapeutics, Inc. (NASDAQ: DICE) to acquire DICE (https://ibn.fm/CPCbR) in a deal valued at approximately $2.4 billion. DICE is a biopharmaceutical company that develops novel oral therapeutic candidates – such as DC-806 and DC-853, both oral interleukin-17 (“IL-17”) inhibitors – currently in clinical development to treat chronic immune system diseases.
The pending acquisition formed the basis of analysis by Aegis Capital Corp., which underlined that the recent M&A activity shows the potential value of BiondVax Pharmaceuticals (NASDAQ: BVXV), a biotechnology company focused on developing, manufacturing, and commercializing innovative immunotherapeutic products. Aegis, therefore, reiterated its Buy recommendation and a $70 target price on BiondVax (https://ibn.fm/wHmf2).
Aegis’ coverage followed BVXV’s June announcement that it had signed an exclusive worldwide license with the Max Planck Society and University Medical Center Göttingen (“UMG”), both in Germany, to develop and commercialize innovative alpaca-derived nanosized antibodies (“NanoAbs”) targeting IL-17 cytokines as treatments for all potential indications, starting with psoriasis and psoriatic arthritis (https://ibn.fm/5bpWM).
“The license of the IL-17 NanoAb from Max Planck is not only an exciting opportunity to develop a unique treatment for psoriasis and other autoimmune diseases, but also another validation of the productivity of our collaboration with Max Planck and UMG and portends additional significant developments to follow,” BiondVax CEO Amir Reichman said at the time.
IL-17 is a family of immune system cytokines that comprises six isoforms (IL-17A to IL-17F). And while the IL-17 pathway is known to contribute to defenses against extracellular bacteria and fungi, it also plays a significant role in originating and feed-forwarding the inflammatory cycle of psoriasis (https://ibn.fm/I1Vqe). Psoriasis is a chronic autoimmune disease that causes inflammation and scaling of the skin. According to the National Psoriasis Foundation, about 8 million people in the U.S. and 125 million worldwide suffer from the condition (https://ibn.fm/sU999).
Given the causative role of IL-17, IL-17 inhibitors, most of which belong to a family of biological drugs called monoclonal antibodies (“mAbs”), are used to treat psoriasis. Chemically, these mAbs bind to the IL-17A cytokine, inhibiting interaction with the IL-17A receptor. However, “the latest and most effective mAbs for the treatment of plaque psoriasis that are currently marketed, as well as those that, to BiondVax’s knowledge, are under clinical development by other companies, target not only IL-17A but also IL-17F and IL-17A/F complex,” wrote the company in the June press release.
DICE’s lead drug candidate, DC-806, which is currently being evaluated in a Phase II study involving participants with moderate to severe plaque psoriasis, targets the IL-17A (https://ibn.fm/V70Fo). Early-stage results released last October nonetheless showed that the drug candidate led to a mean percentage reduction in Psoriasis Area and Severity Index (“PASI”) of up to about 44% compared to 13.3% for placebo. BiondVax’s NanoAbs exhibit several ‘biobetter’ qualities compared to mAbs and IL-17 inhibitors like DC-806, including better patient safety and convenience.
Little wonder that Aegis noted in its report, “This deal between Eli Lilly and DICE Therapeutics illustrates the potential valuation that BiondVax could receive if it has positive early-stage clinical results.” So far, several factors tip the scale in BiondVax’s favor. First, the company is focusing on a condition for which the mechanism of action of existing antibody-based treatments is well understood and has, in fact, been validated through clinical trials that have resulted in FDA approval. Secondly, a preclinical in vivo proof-of-concept study evaluating the company’s anti-COVID-19 NanoAb therapy virtually eliminated the virus from the lungs, caused milder and shorter illness, and had prophylactic properties. While the study evaluated an anti-COVID-19 drug, it showed, at least early on, the capabilities of NanoAbs.
Furthermore, should BiondVax eventually receive FDA approval for its anti-IL-17 NanoAbs, precedent exists showing that the company and its shareholders stand to gain significantly from the potential market demand. Of the three IL-17 inhibitors currently approved by the FDA, Cosentyx (secukinumab) by Novartis Pharmaceuticals Corp. delivered $4.8 billion in sales in 2022, up 5% year over year (https://ibn.fm/TBPVP), while Taltz (ixekizumab) by Eli Lilly generated $2.482 billion in 2022, up from $2.213 billion in 2021 (https://ibn.fm/nHncH). (Sales data from the third drug, Saliq (brodalumab) by Bausch Health, are not publicly available.)
Even with the enormous potential of BiondVax’s anti-IL-17 NanoAbs, the company is committed to developing a pipeline of diversified and commercially viable products and platforms, providing broad based and diversified opportunities for success. In addition to psoriasis and psoriatic arthritis, the company is targeting treatments of diseases with unmet medical needs and attractive commercial opportunities, including asthma, macular degeneration, and COVID-19.
For more information, visit the company’s website at www.BiondVax.com.
NOTE TO INVESTORS: The latest news and updates relating to BVXV are available in the company’s newsroom at https://ibn.fm/BVXV
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