An influential Wall Street analyst has spoken of the “intriguing implications” of Tiziana Life Sciences PLC‘s (LON:TILS, NASDAQ:TLSA) expansion of its cancer portfolio into CAR-T therapy.


On Thursday, the company submitted a patent application covering the potential use of its lead drug candidate, Foralumab, a fully-human anti-CD3 monoclonal antibody, to improve the success of the cutting edge treatment.


“In our view, foralumab could in future be of strategic interest to a number of CAR-T developers with regard to broadening the commercial potential of their products,” said Raghuram Selvaraju, of HC Wainwright, reiterating his ‘buy’ advice and US$25 price target.


CAR-T uses T cells from the patient’s own immune system to tackle the disease. Simply put, they are genetically engineered and “supercharged” to hunt down and destroy cancer cells.


The major problem with the approach is relapse rates are high, limiting the scope of its use.


Tiziana chief executive Dr Kunwar Shailubhai and his team believe an improved CAR-T therapy can be achieved through using anti-CD3 monoclonal antibodies such as Foralumab on its own or with other “co-stimulatory molecules”.


Despite its limitations, CAR-T is a hot area at the moment, underlined by the explosive NASDAQ IPO of Nkarta Inc (NASDAQ:NKTX).


Listed at US$18 a share, stock in the Bay area-based biotech raced to US$$58.69 on the first day of trading earlier this week, valuing the business at just shy of US$1.8bn.


Tiziana has some significant and imminent value kickers of its own, not least the spin-out of its cancer diagnostics business StemPrintER.


Details of the demerger plans are expected circulated “shortly”, according to HCW analyst Selvaraju.


He reckons the business is worth around 10% of the value of Genomic Health, the nearest competitor, or US$280mln.


This figure isn’t factored into the Selvaraju’s DFC valuation of the business, which provided the US$25 price target. Neither is its potential recongnised by the market, juding from the current US$10 stock price, which yields a market capitalisation of US$365mln.


Trading volumes of those US shares should be helped by a change in ratio of the ordinary shares and the American depositary stock.


The ratio is being ‘tweaked’ to two ordinary shares per ADS from the prior five ordinary shares per ADS.


“This change, which does not involve issuance of additional underlying share capital, is being effected to increase the level of liquidity on the NASDAQ Global Market,” said HCW’s Selvaraju.

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