ImmunoCellular Therapeutics, Ltd. (NYSE: IMUC) is a Los Angeles-based clinical-stage company that is developing immune-based therapies for the treatment of brain and other cancers.
The company is focusing resources on advancing its research-stage Stem-to-T-Cell program in collaboration with leading academic researchers and contract laboratories. IMUC is also continuing to explore opportunities to partner its development-stage programs.
On August 23rd, IMUC announced that it plans to continue strategies to refocus and reallocate its available resources on its promising Stem-to-T-Cell research program. ImmunoCellular’s Stem-to-T-Cell program is designed to provide a novel method of harnessing the immune system to manufacture antigen-specific killer T cells that target and destroy cancer cells and provide long-term immuno-surveillance against tumor recurrence. The Stem-to-T-Cell platform has the potential to address many types of cancer, including both solid and hematological tumors.
The company’s near-term milestones include: completion of loading of the T cell receptor DNA sequence into a viral vector during the third quarter of 2017 and transfection of the human hematopoietic stem cells by the loaded viral vector during the fourth quarter of 2017.
These transfected stem cells are anticipated to ultimately be able to produce an unlimited supply of killer T cells bearing the desired T cell receptor. The killer T cells are designed to specifically target and destroy tumor cells. This phase of the Stem-to-T-Cell development is an important component of the proof-of-concept work for this technology. Once proof-of-concept has been established, ImmunoCellular can progress to testing in preclinical models.
On August 23rd, 2017, IMUC also announced financial results for the second quarter 2017. ImmunoCellular incurred a net loss of $3.6 million, or $1.02 per basic and diluted share, compared to a net loss of $5.3 million, or $2.30 per basic and diluted share, for the quarter ended June 30, 2016.
As per management, the Company is in the process of making significant reductions in its operating costs. Besides the previously announced suspension of the phase 3-registration trial of ICT-107 the Company is in the process of reducing its operating expenses through personnel and facility reductions.
So far liquidity is concerned, In July 2017, ImmunoCellular completed the first tranche of a financing that provided $5 million in gross proceeds from the sale of convertible preferred stock, with the potential to secure an additional $9 million in funding from the exercise of warrants in the financing transaction over the next 12 months.
The Company plans to further strengthen its overall financial flexibility and liquidity by obtaining additional financing through the issuance of financial instruments such as equity and warrants or through the receipt of grants and awards. Additionally, the Company continues to evaluate its strategic alternatives, which may include a potential merger, consolidation, reorganization or other business combination, as well as the sale of the Company or the Company’s assets.
The Stem-to-T-Cell research program, exhibits superiority to the existing standard of care. The company is approaching a key point in its development programs and the results from the upcoming milestone should enable the company to focus on promising therapies with the highest potential both in terms of efficacy and market size.
The Company’s stock has found strong action in the past and with the recent developments, analysts have revised their outlook on the stock. The stock currently has an average rating of “Buy” and a consensus price target of $5.00 (suggesting over 1500% gain from present levels). Considering present valuation, the company is at a favorable risk reward position.
About the Company: ImmunoCellular Therapeutics, Ltd. is a Los Angeles-based clinical-stage company that is developing immune-based therapies for the treatment of brain and other cancers.
Immunotherapies are being widely investigated as a way to develop highly specific anticancer therapies. The goal of most of these immunotherapies is to create a population of killer T cells that are programmed to destroy tumor cells.
- A Stem-to-T-Cell research program, which engineers hematopoietic stem cells to generate cytotoxic T cells;
- ICT-121, a patient-specific, dendritic cell-based immunotherapy targeting CD133 found in recurrent glioblastoma;
- ICT-140, a patient-specific, dendritic cell-based immunotherapy targeting ovarian cancer.
About Stem-to-T-Cell: ImmunoCellular’s Stem-to-T-Cell platform represents a novel and more direct approach to generating killer T cells by using the patient’s stem cells as starting material. Thus, ImmunoCellular’s Stem-to-T-Cell technology shares some similarities with other immuno-oncology technologies, such as CAR-T, and could potentially be used in combination approaches. Unlike CAR-T therapies, which deliver a large bolus of active T cells into the patient’s circulation and have been associated with toxicity in some patients, ImmunoCellular’s approach enables a more gradual and measured release of killer T cells and has the potential for lower toxicity while also yielding a more sustained response.
About ICT-107: During the second quarter, the Company announced the wind down of the phase 3 registration trial of ICT-107 in newly diagnosed glioblastoma, while also seeking collaborative relationships relative to its pipeline of clinical-stage dendritic cell-based programs. The Company is focusing on financing and strategic alternatives for its immuno-oncology research and development pipeline and technology platform, which may include a potential merger, consolidation, reorganization or other business combination, as well as the sale of the Company or the Company’s assets.
2nd Quarter 2017 Financial Results:
For the quarter ended June 30, 2017, ImmunoCellular incurred a net loss of $3.6 million, or $1.02 per basic and diluted share, compared to a net loss of $5.3 million, or $2.30 per basic and diluted share, for the quarter ended June 30, 2016.
For the quarter ended June 30, 2017, research and development expenses were $10.4 million compared to $4.4 million during the quarter ended June 30, 2016. The increase reflects additional patients enrolled in the Company’s phase 3 trial of ICT-107. The Company suspended this trial in June, and wrote off approximately $2.3 million of trial-related supplies and accrued approximately $3 million of expenses to wind down the trial.
During the quarter ended June 30, 2017, ImmunoCellular also recorded a credit of $7.7 million to account for the forgiveness of debt related to the CIRM award. This represents $5.5 million of funds advanced by CIRM for the phase 3 ICT-107 trial and the reversal of $2.2 million of accrued interest.
The Company used $9.5 million of cash in operations for the six months ended June 30, 2017, compared to $11.2 million for the six months ended June 30, 2016.
Key risk factors and potential stock drivers:
- Successful achievement of upcoming milestones, would lead future direction for IMUC. Any adversities related to these upcoming milestones might adversely impact the overall investor sentiments.
- In June, ImmunoCellular received a Deficiency Letter indicating that the Company is not in compliance with the stockholder’s equity requirement of the NYSE MKT Company Guide. As required, the Company submitted a plan to the NYSE MKT advising of actions it plans to undertake, to regain compliance with the continued listing standards by December 23, 2018. The Company is awaiting response from the NYSE MKT to its plan, elements of which included financing and restructuring of operations. If the Company’s plan is not accepted or if the Company fails to regain compliance by December 23, 2018, the NYSE MKT may commence delisting procedures.
- IMUC is still at a pre-commercialization stage and has not yet generated meaningful revenue and will likely operate at a loss as it grows its market position and seeks ways to monetize it.
- Any time or cost overrun in its ongoing R&D activities and its impact on business & financial profile will remain a key business sensitivity factor. Moreover, meaningful commercialization of IMUC’s present pipeline is not likely to happen in the near to medium term.
On Monday, September 18th, 2017, IMUC is trading at $0.35 (+ 9.22%), with an above average volume of 2.8 million shares exchanging hands. Market capitalization is $4.89 million. The current RSI is 51.95.
In the past 52 weeks, shares of IMUC have traded as low as $0.25 and as high as $5.19
At $0.35, shares of IMUC are trading below its 50-day moving average (MA) at $0.42 and below its 200-day MA at $1.71
The present support and resistance levels for the stock are at $0.29 & $0.33 respectively.
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