BX - Autolus Therapeutics: The Story Has Improved

Summary

• Today, we circle back on a small T cell therapeutic concern called Autolus Therapeutics plc for the first time since the first half of 2021.
• The company is advancing its pipeline, recently addressed its near-term funding needs and could have potentially key trial data out at mid-year.
• An investment analysis follows in the paragraphs below.

Laughter and tears are both responses to frustration and exhaustion. I myself prefer to laugh, since there is less cleaning up to do afterward .”? Kurt Vonnegut

Today, we put the spotlight on Autolus Therapeutics plc ( AUTL ) for the first time since May of 2021. We concluded that article on this clinical-stage biopharmaceutical concern with the following investment recommendation:

Autolus has multiple 'shots on goal' and has recently addressed its near-term funding needs. Analyst commentary is not nearly as sanguine on the stock as it was when we last looked in on the company late in 2019, primarily because of the decision to curtail development around AUTO3 in January of this year until it is partnered. The company has some upcoming trial milestones (above) that might be potential small catalysts for the stock. Obviously, finding a collaboration partner for AUTO3 could provide a big boost for the shares. That said, the company is some ways out for any potential commercialization. Autolus will also most likely have to raise capital again, most likely sometime in 2022. Given that, we are passing on any investment recommendation at this time.

Given the passage of time, it seems to circle back on Autolus to see how its pipeline is progressing. An updated analysis follows below.

Company Overview

Autolus Therapeutics is an early stage developmental company. The company is headquartered in London and is focused on developing T cell therapies for the treatment of cancer. It has several early stage candidates in its pipeline. The stock currently trades at two bucks a share and has an approximate market capitalization of $375 million.

Autolus uses use Chimeric Antigen Receptors or CARS to reprogram its T cell product candidates. According to company's website :

These receptors combine the tumor recognition domain of an antibody with the activation and costimulatory domains from the t cell receptor to rearm a patient’s T cells to recognize and kill their cancer cells.

The company's main product candidate is dubbed Obe-cel. It is described as:

An autologous CD19 CAR T cell therapy with a unique CD19 CAR. The CAR is designed to have a “fast-off” kinetic which mimics physiological T-cell receptor interactions. Clinical trials of obe-cel have demonstrated that this enhanced kinetic profile results in increased T cell persistence and reduced T cell exhaustion, leading to high levels of durable remissions and remarkably low levels of cytokine release syndrome.

Obe-cel is in development to target many indications. The most advanced and important to the company near and medium term future is targeting adult Acute Lymphoblastic Leukemia or ALL. This market has an high unmet need.

Obe-Cel is currently in an ongoing and potentially pivotal Phase 2 trial 'Felix' for this indication. Obe-cel is also in earlier stage development for other oncology indications.

The company has several other compounds in development beside obe-cel. However, there are in pre-clinical or Phase 1 development so will not be the primary focus of this analysis.

Recent Developments:

December was a heavy month for news flow around Autolus Therapeutics. On December 8th, the company announced that the interim analysis of a potentially phase 2 study of obe-cel for the treatment of a type of blood cancer found that the trial had met its primary goal. According to the data released, obe-cel demonstrated an overall remission rate of 70% in 50 patients with relapsed/refractory ALL.

That same day, Autolus received $70 million in milestone payouts as part of a collaboration and financing deal agreed to late in 2021 with Blackstone which could provide Autolus a total of up to $250 million in equity and product financing based on scheduled milestones. The next day, the company raised approximately $150 million via a secondary offering.

Analyst Commentary & Balance Sheet

Since December, four analyst firms including Needham and Jefferies have reissued Buy/Outperform ratings on the stock. Price targets proffered range from $6 to $18 a share.

Only approximately one percent of the stock's outstanding float is currently held short. The company ended the third quarter with just over $160 million in cash and marketable securities on its balance sheet. Autolus then received $19.1 million in R&D tax credits in October. With the recent capital raise and with the recent $70 million payout from the company's arrangement with Blackstone ( BX ) , Autolus is well capitalized to continue to advance its diverse pipeline for the moment. The company did post a net loss of $42.8 million in the third quarter it should be noted.

Verdict:

As you can above, the company has numerous trial readouts around the candidates in its pipeline scheduled for 2023. When we last visited Autolus, it was several months after the company had decided to put development of a candidate called AUTO3 on hold until it could find a partner to help with development. This resulted in layoffs at the company.

Well, Autolus still has not found a developmental partner for AUTO3. However, the company has addressed near term funding concerns, and has advanced its current primary candidate. There are also several trial milestones on the horizon, the most important is additional Felix data at mid-year. With strong analyst support, and a much lower stock price since our last piece on Autolus, AUTL seems to now merit a small ' watch item ' holding pending further developments. If all goes well, Autolus could be submitting its first Biologics Licensing Application or BLA to the FDA by year end or soon thereafter and the company is preparing for potential commercialization.

The only thing more frustrating than slanderers is those foolish enough to listen to them .”? Criss Jami

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