PDSB - The Prognosis For PDS Biotechnology

2023-08-13 05:30:32 ET

Summary

• PDS Biotechnology Corporation has had a volatile stock performance in recent years.
• The company has made slow and steady progress advancing its pipeline and is well-liked within the analyst firm community.
• With two registrational studies on the horizon, it seems a good time to 'circle back' on this small developmental, oncology-focused concern.
• An updated analysis follows in the paragraphs below.

It is useless to attempt to reason a man out of a thing he was never reasoned into .”? Jonathan Swift

Today, we put PDS Biotechnology Corporation ( PDSB ) in the spotlight. As can be seen below, the stock has had a roller coaster ride over the past few years. The stock recently gave up its gains it had in late May on positive mid-stage trial data. Where are the shares likely to go from here? An analysis follows below.

Company Overview:

PDS Biotechnology Corporation is a New Jersey headquartered clinical-stage biopharmaceutical company. The company is focused on developing multifunctional cancer immunotherapies. The stock currently trades just below five bucks a share and has an approximate market capitalization of $135 million.

PDS Biotechnology is trying to unleash a powerful and targeted T-cell attack by ' training ' the immune system using drug candidates developed off its proprietary Versamune platform. It is hoped that this compounds and improve treatment and patient outcomes across the cancer spectrum.

The company's lead drug candidate is dubbed PDS0101. This is a novel investigational human papillomavirus (HPV)-targeted immunotherapy, delivered via a simple subcutaneous injection in combination with other immunotherapies and cancer treatments, that stimulates a potent targeted T cell attack against HPV-positive cancers. This drug candidate has garnered Fast Track designation as a potential combo therapy with Merck's ( MRK ) blockbuster Keytruda to treat recurrent or metastatic HPV16-positive head and neck cancer.

PDS0101 is currently being evaluated in four Phase 2 clinical trials for the treatment of various types of HPV-positive cancers within combination therapies. Interim data from a Phase 2 study VERSATILE-002 evaluating PDS0101 as part of a combo therapy with Keytruda for its Fast Track indication came out on May 26th.

Some data points from this interim disclosure were encouraging, such as an 87.1% 12-month overall survival or OS rate and a 10.4-month median progression-free survival or PFS across 48 patients. However, eight percent of the patient pool experience grade 3 adverse events and the study has not reached its median overall survival point yet. 14 out of 54 patients indicated either a complete or partial response on two consecutive scans.

Management has stated this data is good enough to kick off VERSATILE-003, which should commence sometime before the end of this year. This will be a global multi-center Phase 3 registrational trial that will involve just over 300 patients. The two primary endpoints will be OS and PFS. This study will contain two planned interim analysis. Managements believes these checkpoints could provide early opportunities for discussion with the FDA regarding accelerated approval for this combo therapy. VERSATILE-003 is the company's biggest priority at this time.

PDS Biotechnology's second key focus area is on a triple combo therapy of PDS0101 and PDS0301, PDSB's novel investigational tumor targeting IL-12 and a commercial immune checkpoint inhibitor, or ICI. This combination used in an investigational ICI has been evaluated in a Phase 2 clinical trial in all types of HPV-positive cancers, including anal, cervical, head and neck and several other cancers in both ICI naive and ICI refractory cancers. Management has seen highly promising objective responses and survival benefit demonstrated in both. PDS0301 was acquired from Merck KGaA late in 2022.

The company is prioritizing this triple combination being evaluated further against ICI refractory head and neck cancer as this is the largest and most rapidly growing of the HPV cancer populations. Leadership is awaiting initial data from the refractory arm from VERSATILE-002 in ICI refractory head and neck cancer to inform it on the design for its triple combination therapy in a registrational study. That data from VERSATILE-002 should be out sometime this quarter.

Finally, encouraging data from a phase 2 study of PDS0101 in combination with chemoradiotherapy to treat patients with cervical cancer was posted in mid-November of last year.

Analyst Commentary & Balance Sheet:

Since first quarter numbers were posted, Oppenheimer ($24 price target), H.C. Wainwright ($21 price target) and Noble Financial ($17 price target) have reissued Buy ratings on the stock.

Just over 13% of the outstanding float in the shares are currently held short. There has been no insider selling or buying in the stock since late 2021. PDS Biotechnology ended the first quarter with approximately $65 million in cash and marketable securities on its balance sheet. Management stated at that time that funding in place was enough to fund all operations and research and development programs into the third quarter of 2024.

Verdict:

We concluded our first article around PDS Biotechnology in October of last year with this conclusion:

Given its potential, technology platform, partnerships, analyst firm support and multiple 'shots on goal', the company seem better than a dart throw and worthy of a small 'watch item' position as this story develops. "

Despite the rocky ride of the stock since then, the shares are still up over 50% from that original take on the company. The next key milestones for the company will be the kick of two registrational studies, one by the end of this year. Giving PDS Biotechnology's current funding levels, I also expect management to do some sort of capital raise over the next few quarters as well.

In summary, the company continues to make progress advancing its pipeline, but still only merits a small ' watch item ' holding pending further developments.

Insanity is often the logic of an accurate mind overtasked ”? Oliver Wendell Holmes Sr.

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