EVAX - Evaxion: An Intriguing AI Vaccine Company With Big Pharma Collaboration

2024-03-31 06:39:26 ET

Summary

• Evaxion's sophisticated AI Immunology platform aims to outperform competitors in vaccine development, in both oncology and infectious diseases indications.
• The company has already established three collaborations, including a partnership with MSD, and has raised enough funding to last through 2024.
• Evaxion's AI models, including EDEN, RAVEN, PIONEER, ObsERV, and AI-DEEP, show promise in identifying protective antigens, designing effective and safe personalized cancer vaccines and predicting which patients will respond.
• Big pharma interest, pending catalysts in 2024, impressive proof-of-concept preclinical and clinical data are compelling enough for me for a small speculative position.
• However, the risk of considerably more dilutive funding as well as the very early stage of the pipeline make me give a "Hold" recommendation.

Thesis overview

Evaxion ( EVAX ) aspires to use artificial intelligence ((AI)) to design vaccines for cancer immunotherapy, as well as for infectious diseases. EVAX claims being more advanced than competition because it has been constantly developing and improving its models for 15 years. Additionally, EVAX has in-house capability to validate novel targets identified by its AI models in state-of-the-art animal models.

Although I can't claim to have a deep understanding of Evaxion's AI technology there are good reasons to be bullish about EVAX, including multiple collaborations (including a collaboration with MSD, which is also a 15% shareholder), as well as proof-of-concept (POC) preclinical and clinical data in both infectious diseases and oncology. Additionally, EVAX has recently raised sufficient cash to last through 2024, during which time EVAX aims to report achievement of several additional milestones (more POC data, potentially new partnerships, and/or progress with existing partnership) that could boost the stock price. The major risk to the thesis is the need for a lot more cash to progress with the pipeline. Nevertheless, I believe EVAX has a good chance of establishing more partnerships and good news during 2024 could help EVAX raise cash from a stronger position and/or non-dilutively.

Overview of Evaxion's strategy

EVAX aims to use its AI platform for the following purposes;

1. To quickly and efficiently identify appropriate antigenic epitope targets that are predicted to elicit protective B-cell and/or T-cell responses. Selected epitopes can then be incorporated into vaccine constructs. Evaxion's model can be used for vaccine development both in infectious diseases and oncology.
2. To predict which patients will respond to treatment with immune checkpoint inhibitors. The goal is to both improve patient outcomes (by guiding personalised treatment algorithms and timelier use of the treatment most likely to work) and to save costs (by avoiding use of expensive treatments that are unlikely to work).

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