Genticel
Written by
Genticel |
Further Phase II data announced |
18-month Phase II results |
Pharma & biotech |
28 June 2016 |
Share price performance
Business description
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Genticel is a research client of Edison Investment Research Limited |
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Genticel has announced 18-month data from the Phase II trial of the GTL001 vaccine to treat early-stage human papillomavirus 16 and 18 infections (HPV16/18). In this update, GTL001 showed no statistically significant difference in any subgroup. Safety remains positive. Genticel will present 24-month data in Q117, which will include the full data set and inform next steps. The company continues leveraging its Vaxiclase platform in collaboration with the Serum Institute of India (SIIL) and plans to expand its pipeline. We have revised our valuation down to €2.31/share (€5.75/sh previously) as we have cut the probability of success for GTL001.
Year end |
Revenue |
PBT* |
EPS* |
DPS |
P/E |
Yield |
12/14 |
0.00 |
(10.81) |
(78.1) |
0.0 |
N/A |
N/A |
12/15 |
0.18 |
(11.19) |
(72.1) |
0.0 |
N/A |
N/A |
12/16e |
0.00 |
(8.66) |
(55.8) |
0.0 |
N/A |
N/A |
12/17e |
0.00 |
(8.30) |
(53.4) |
0.0 |
N/A |
N/A |
Note: *PBT and EPS are normalised, excluding intangible amortisation, exceptional items and share-based payments. 2014 restated due to IFRS adjustments.
18-month Phase II data released
Genticel has announced further data from its Phase II trial in HPV16/18 positive women. After 18 months, neither the predefined nor the post-hoc groups showed a statistically significant viral clearance rate vs placebo. Although GTL001 has shown biological activity, it has missed significance due in part to the small number of patients. In consequence, the company will wait until the full data set is available at 24 months, which is expected in Q117. Notably, no safety issues have arisen.
Rethinking the steps ahead
While a partnership focused on advancing the candidate into pivotal Phase III trials is now less likely, the lessons learnt from the fully completed trial could allow a partnership to assess GTL001 in a new Phase II trial focused on a specific subgroup of patients that have shown a sufficiently robust signal. A partnership could also be focused on preparing the next-generation candidate GTL002 for Phase I.
Vaxiclase platform provides potential upside
Genticel also has the Vaxiclase antigen delivery platform, which will continue to develop in collaboration with SIIL for multivalent vaccine applications. The company will engage in business development activities and announce the addition of new products to its pipeline in the next six months.
Valuation: New rNPV of €2.31 vs previous €5.75
We lower the Phase II probability for women with normal cytology from 40% to 20% and the partnering probability from 55% to 20%. Hence, we adjust our valuation to €2.31/share vs previous €5.75/share before dilution (€2.11 vs €5.26 including dilution). Our financials remain unchanged. Assuming the same cash burn rate as Q116, the estimated net cash and equivalents at end Q216 are €15.8m, which provides enough runway until mid-2018.
Exhibit 1: Financial summary
€000 |
2014 |
2015 |
2016e |
2017e |
||
Year End December |
IFRS |
IFRS |
IFRS |
IFRS |
||
PROFIT & LOSS |
||||||
Revenue |
|
|
0 |
178 |
0 |
0 |
Cost of Sales |
0 |
0 |
0 |
0 |
||
Gross Profit |
0 |
178 |
0 |
0 |
||
EBITDA |
|
|
(10,885) |
(11,361) |
(8,760) |
(8,300) |
Operating Profit (before amort. and except.) |
|
(10,912) |
(11,412) |
(8,810) |
(8,350) |
|
Intangible Amortisation |
(8) |
(4) |
(5) |
(5) |
||
Exceptionals |
0 |
0 |
0 |
0 |
||
Other |
0 |
0 |
0 |
0 |
||
Operating Profit |
(10,920) |
(11,417) |
(8,815) |
(8,355) |
||
Net Interest |
105 |
223 |
150 |
50 |
||
Profit Before Tax (norm) |
|
|
(10,808) |
(11,189) |
(8,660) |
(8,300) |
Profit Before Tax (FRS 3) |
|
|
(10,815) |
(11,193) |
(8,665) |
(8,305) |
Tax |
0 |
0 |
0 |
0 |
||
Profit After Tax (norm) |
(10,780) |
(11,137) |
(8,610) |
(8,250) |
||
Profit After Tax (FRS 3) |
(10,815) |
(11,193) |
(8,665) |
(8,305) |
||
Average Number of Shares Outstanding (m) |
13.8 |
15.4 |
15.4 |
15.4 |
||
EPS - normalised (c) |
|
|
(78.1) |
(72.1) |
(55.8) |
(53.4) |
EPS - (IFRS) (c) |
|
|
(78.4) |
(72.5) |
(56.1) |
(53.8) |
Dividend per share (p) |
0.0 |
0.0 |
0.0 |
0.0 |
||
Gross Margin (%) |
NA |
NA |
NA |
NA |
||
EBITDA Margin (%) |
NA |
NA |
NA |
NA |
||
Operating Margin (before GW and except.) (%) |
NA |
NA |
NA |
NA |
||
BALANCE SHEET |
||||||
Fixed Assets |
|
|
228 |
457 |
457 |
457 |
Intangible Assets |
19 |
52 |
52 |
52 |
||
Tangible Assets |
95 |
156 |
156 |
156 |
||
Fixed term investments |
10,076 |
5,043 |
5,043 |
0 |
||
Other |
114 |
249 |
249 |
249 |
||
Current Assets |
|
|
25,899 |
20,388 |
11,176 |
7,319 |
Stocks |
31 |
53 |
53 |
53 |
||
Debtors |
236 |
714 |
714 |
714 |
||
Cash |
22,727 |
16,682 |
7,470 |
3,853 |
||
Other |
2,904 |
2,940 |
2,940 |
2,700 |
||
Current Liabilities |
|
|
(3,960) |
(3,331) |
(3,308) |
(3,308) |
Creditors |
(3,448) |
(2,710) |
(2,708) |
(2,708) |
||
Short term borrowings |
(512) |
(621) |
(600) |
(600) |
||
Long Term Liabilities |
|
|
(2,026) |
(2,223) |
(1,623) |
(1,023) |
Long term borrowings |
(1,646) |
(1,901) |
(1,301) |
(701) |
||
Other long term liabilities |
(380) |
(322) |
(322) |
(322) |
||
Net Assets |
|
|
20,141 |
15,291 |
6,703 |
3,446 |
CASH FLOW |
||||||
Operating Cash Flow |
|
|
(9,952) |
(11,968) |
(8,962) |
(8,160) |
Net Interest |
105 |
223 |
150 |
50 |
||
Tax |
0 |
0 |
0 |
0 |
||
Capex |
(73) |
(152) |
(55) |
(55) |
||
Acquisitions/disposals |
0 |
0 |
0 |
0 |
||
Equity Financing |
41,353 |
318 |
0 |
0 |
||
Other items |
(2,602) |
568 |
(345) |
(495) |
||
Net Cash Flow |
28,831 |
(11,010) |
(9,212) |
(8,660) |
||
Opening net debt/(cash) |
|
|
(2,125) |
(30,645) |
(19,203) |
(10,612) |
HP finance leases initiated |
0 |
0 |
0 |
0 |
||
Other |
(311) |
(433) |
621 |
600 |
||
Closing net debt/(cash) |
|
|
(30,645) |
(19,203) |
(10,612) |
(2,552) |
Source: Edison Investment Research, Genticel accounts
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