“Edison’s accessible and high-quality research gives us the opportunity to communicate an independent perspective of Tyman to a wide variety of potential stakeholders.”
Currency in USD
Last close As at 07/06/2023
USD1.40
▲ 0.11 (8.53%)
Market capitalisation
USD22m
Research: Healthcare
In an unexpected move, Context Therapeutics has announced that it will be discontinuing further development work on its ONA-XR program and prioritize the development of its novel preclinical bispecific CLDN6xCD3 antibody, CTIM-76. While we view the news as disappointing given efficacy data in the OATH study were encouraging, we understand the need to prioritize safety for patients. With a market cap of $11m, Context is trading well below cash levels (end-FY22 cash balance of $35.5m). We have withdrawn our estimates and will revisit our model assumptions and overall valuation in due course. We note that the discontinuation of the ONA-XR programs allows Context to extend its cash runway to late 2024 (versus early 2024 previously), well past the planned IND filing of CTIM-76 in Q124.
Context Therapeutics |
Strategic pivot in pipeline focus |
Business update |
Pharma and biotech |
23 March 2023 |
Share price performance
Business description
Analysts
Context Therapeutics is a research client of Edison Investment Research Limited |
||||||||||||||||||||||||||||||||||||
In an unexpected move, Context Therapeutics has announced that it will be discontinuing further development work on its ONA-XR program and prioritize the development of its novel preclinical bispecific CLDN6xCD3 antibody, CTIM-76. While we view the news as disappointing given efficacy data in the OATH study were encouraging, we understand the need to prioritize safety for patients. With a market cap of $11m, Context is trading well below cash levels (end-FY22 cash balance of $35.5m). We have withdrawn our estimates and will revisit our model assumptions and overall valuation in due course. We note that the discontinuation of the ONA-XR programs allows Context to extend its cash runway to late 2024 (versus early 2024 previously), well past the planned IND filing of CTIM-76 in Q124.
Year |
Revenue ($m) |
PBT* |
EPS* |
DPS |
P/E |
Yield |
12/21 |
0.0 |
(10.6) |
(3.74) |
0.0 |
N/A |
N/A |
12/22 |
0.0 |
(14.8) |
(0.93) |
0.0 |
N/A |
N/A |
Note: *PBT and EPS are normalized, excluding amortization of acquired intangibles, exceptional items and share-based payments.
Context reported FY22 results, although details of financial performance were overshadowed by its announcement that it will discontinue its flagship ONA-XR program (three ongoing Phase II trials and one Phase Ib trial in advanced breast, endometrial and ovarian cancers) and focus its resources on the other preclinical asset, CTIM-76, a bispecific CLDN6xCD3 antibody, targeting Claudin 6 expressing tumors. Context will now focus its R&D activities on CTIM-76, which was selected as the final candidate for its CLDN6 program in December 2022. CLDN6 has emerged as a highly attractive therapeutic target in oncology, with expression across a variety of malignant tumor cells but rarely in healthy tissue. We view the competitive landscape as limited, with the main competition being BioNTech (BNT211) and Amgen (AMG 794). Context argues that, based on preclinical data, CTIM-76 displays superior CLDN6 selectivity and activity compared to competitors. The company has initiated Investigational New Drug (IND) enabling studies with CTIM-76, and plans to file an IND application in Q124.
Management has disclosed that in the ongoing Phase II OATH trial for endometrial cancer, liver enzyme elevations were observed in a few patients and, although not considered serious adverse events, they would have required additional analyses resulting in increased costs and trial delays. We remind readers that liver enzyme elevation was the primary reason that the underlying immediate-release version of ONA-XR was previously pulled from clinical trials (see our initiation note for more details) and the extended-release version had been pitched as a safer alternative. As part of this decision, the collaboration with the Menarini Group (ELONA trial) has also been terminated.
We have withdrawn our estimates and valuation for Context and will reintroduce our revised valuation in due course. We note that this new pipeline focus frees up some of the company’s cash, extending the cash runway to end 2024 according to management (from early 2024 previously).
|
|
Research: Healthcare
Following a tumultuous H123 marked by UK regulatory challenges for SDC-1801, Sareum has pivoted to Australia as a clinical trial destination. With the trial application filed and awaiting confirmation (expected in Q223), we anticipate the long-due Phase Ia trial to commence by mid-2023, followed by the crucial Phase Ib study in 2024, if initial safety data are positive. The operating loss during the period increased c 72% y o y to £1.75m, reflecting increased investment in the preparation for clinical studies. We expect this figure to rise with trial commencement. This will likely translate to a material increase in cash burn in the coming months (vs the H123 run rate of £1.3m) and we expect Sareum will need to raise additional funds before the end of CY23 (H123 cash balance of £2.9m). We see initiation of the Phase I study as a key catalyst for a potential re-rating.
Get access to the very latest content matched to your personal investment style.
