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We aren’t beholden to it, we can just sell and invest elsewhere…it can offer significant upside with the right company and for me Hvivo is low risk compared to 99% of Aim.
Agree, last month has been a tough watch…but SP had climbed > 100% in first six weeks of the year.
Still think there’s good value at this level imho…
At least Mo knows his potentially life changing LTIP isn’t a given… :-)

To quote AstraZeneca…
“AstraZeneca is working to bring patients closer to cure through the detection and treatment of early stage disease” .
It’s complimentary to treatment…
Indeed picked up earlier, more scope to treat rather than patient solely receiving procedure / palliative…

Hi Mazik…I would think they’ll get taken out at a point when the technology is proven, and one of the big guys come in for them - although AS has shown the ability to establish flexible commercial models so maybe they won’t do something as binary…
Is probably some trade off between nurturing business value and speed of getting it to market - manufacturing / distribution etc… for this product - needs an established industry leader, benefit is you get the asset out their quicker and therefore save lives quicker but potentially limit business valuation??…not sure…a few interested parties and who knows…

Personal view…they grow to c 30p a share in the next 12-24 months as they tick off milestones and they get bought at a multiple of that, so maybe 50p-75p a share, but some key proof points before they get to that point…so far so good…
(just imho)

Just offering a different view on SP potential…

I’m being a little fanciful…but take it for what it is :-)

- China tests 3mn pa at $100 per test, 10% royalty.
- US, let’s assume 250k tests pa at $500 per test, 15% royalty
- RoW, let’s assume 250k tests pa at $500 per test, 15% royalty

That gets us to $550mn in royalties per annum, EV multiplier of x10 gets us to $5.5bn or roughly £13 per share.

Given acquisitions are significantly above existing Market Cap, ignoring the big guns like Pfizer paying $43bn for Seagen this week - let’s look a little lower…Provention Bio bought this week by Sanofi for $2.9bn…SP at close day before $6.70, paid $24…
If we assume a 2x multiple, that gives an acquisition price of £26 per share.

As I say being a little glib…don’t think the China tests will be $100 each, think it’s unlikely they’ll do that volume either per annum at full flight, but even if we low ball all the above and say they’ll only achieve 10% of the above thats still £2.60…clearly have hurdles to clear with the LDT/ELISA tests and this isn’t a 6 month journey…but the potential is huge…

(Personal view, suspect CIZ will be acquired way before getting to this point)

Oh…and this doesn’t consider the bio marker testing for breast cancer / others…

Morning Trout…I “think” the £1m was for Ampligen cancellation…the Vaxart one would be incremental this FY - Only thing I would question is whether they had committed to a challenge study - I suspect not as it hadn’t been RNS’d, but worst case we’ve saved cash on the development of the agent and characterisation work as I thought Vaxart had funded that? (thought I’d seen reference to it in a contract somewhere)

(part 2)

Picking up on the Sunday roast podcast and the Stockbox event mid-Feb, some soundbites around near term inflection points…

Sunday roast 26 mins in re China: “A specialist group setting up a subsidiary purely to bring Cizzle biotechnology to market”

Sunday roast 39 mins in: “things are progressing extremely well so the best I can do is watch this space” (referencing that he can’t be more specific due to market restrictions).

Stockbox 16th Feb

“We are completing the optimisation work on that, not yet complete, we hope that will be done shortly”

“We hope to be able to ship our prototype platforms in the near future, but waiting for the final optimisation tests to be completed”

I don’t think you can go as far as saying news is imminent…it’s biotech…but think we have an interesting few weeks and months ahead…

Hi lmvfun - sorry for delay in replying … (part 1)

I don’t think I’d be brave (stupid) enough to get into future share price predictions but some general thoughts below…

- When Cizzle listed their broker Hardman suggested they were 78% undervalued at listing price compared to peers.
- The current MC of £10mn is below the £23mn valuation by Hardman last summer, and there’s clearly been significant progress since then…their next Broker note will be interesting!
- The decline to < 1.5p, in my mind was down to 3 key issues, neither company specific: 1) RTO carrying weight of legacy investors cutting losses 2) Sector is typically slow on news and needs patience, inevitably price can drift over time 3) Key one though for me was sector sentiment - struggle to think of any company in the sector whose SP grew in 2022…and on no bad news eg. Hvivo 48p down to 9p, Renalytix 1100p down to 110p…Cizzle were in good company…
- However, now seeing greater market interest and awareness - one key element for me here is Cizzle have strong commercial and industry engagement - belies their size. Even going back to the noughties they had grants from the Wellcome foundation.
- Chairing sessions and presenting at the recent Biomarker forum in Manchester, shows they are still engaging at the right level and the partnerships formed in the last 12 months add weight to AS’s ability to engage the right partners at the right level. Think this can be a weakness in scientist led companies, don’t see any weakness here with Ciz.

If we turn to acquisition, I’d like to see this to be at least a couple of years away, but the more milestones they hit, the greater the pressure will come to resist that.

In a very competitive pharma industry with a number seeing patents reaching end of life and needing new innovations to fill their place - a diagnostic product carries far less risk that a drug development and gives them another 20 year window of protection.

Abbvie’s Humira is worth $20bn per annum, patent expires this year, Merck’s Keytruda is worth $15bn, expires in 2027…they need replacement revenue once the patents expire.

One of the guys on here pulled out the following from AZ ref lung cancer
“AstraZeneca is working to bring patients closer to cure through the detection and treatment of early stage disease” . Diagnostics an increasingly hot topic.

https://www.bain.com/insights/life-sciences-tools-global-healthcare-private-equity-and-ma-report-2022/

In terms of the science, Gilead have invested hugely in this space and their product, while covering multiple cancers, (Ciz should aswell in time), is more expensive than Cizzle and critically only has a 42% success rate for Stage 1 vs 95% with Cizzle (lab result)

Re current valuations, while recognising it’s not yet revenue generating, there are many companies in the sector at £100mn+ without generating a revenue…so I don’t see that as a barrier to higher valuation… plus this is two decades in the making

So in the Feb stockbox interview, AS mentioned re the LDT test, they were waiting for US partner to complete that process. Corepath confirmed in November all on track in that respect.
Final optimisation of test, in his words “done shortly”, but that could be any time in the coming weeks, and then mentions shipping prototype platforms in near future.

Don’t think any CEOs would be foolish enough to give more definitive timescales as it can bite you on the backside.

Personally think next RNS will be additional commercial partner, then assay optimisation/platforms shipped, and Conduit after that (if timescales of UK SPACs are anything to go by)

Last week you said Hvivo had a great future Colin… a week of negative SP movement brings out that sentiment (understandably), but assume it will flip next week - if II’s were buying 2.5mn shares at 19.5 (from memory), I’m sure there will be interest at these levels, but quite a bit of nervousness across the markets this week.

Re the order book, I would expect them to convert 50% + given lack of competition (non conversion probably down to other factors - timing, inconclusive ph1 etc…), but some of those opportunities will be early days, and might be in pipeline for FY25 potentially.

I think Mo is very prudent, definitely a belt and braces mindset and doesn’t talk up the story, far more measured than CF…

We know they’ll be c £60mn this FY…thinking incremental news won’t be far off and sentiment flips again…

As mentioned earlier, SP tends to follow a similar pattern (not just here), when no news…
- Slowly recedes a few %
- Get a larger drop where some spooked at seeing red, think it will fall further, sell, amplifying the drop.
- Reaches a point where value seen and others wade in…hopefully around now…
- RNS’s land, price rises…

Given growth of order book, extending H-Lab services / Venn, think news will be more frequent than previous years, only been a 4-5 week hiatus…

Took the liberty of copying Jiggers note below re upcoming inflection points, think we’re in a good place generally despite today…

In no particular order:
- Completion of World’s First Omicron Human Challenge Study Model
- Announcement of one or more Omicron Human Challenge Trials valued c. £10+ million each
- Expansion of facilities & premises to accommodate demand for Human Challenge Trial work
- Disease In Motion IPO & monetisation
- Clinical efficacy of Imutex’s AGS-v PLUS against mosquito-borne diseases
- Development of a Broad-Spectrum ‘Universal’ Influenza Vaccine, FLU-v
- Shareholder Distribution to existing holders
- New Human Challenge Models being developed
- Expansion into traditional Phase 1 & 2 clinical trials
- Additional lab service offerings to third parties
- Increase in APAC Human Challenge Trial contracts valued c.£6 million each
- Repeat business from Big Pharma worldwide clients
- More RSV, Malaria , Influenza, Covid etc Muliti Million £ Human Challenge Trial contracts
- Significant increase in cash balance and over delivery of current revenue expectations
- Potential Nasdaq listing

They’ve stated before:
1) Capacity to see them to £65-£70mn
2) If they need capacity then, there are hotel options available to them.
3) They can stand a new site up in c.3 months

Based on the Whitechapel site, it was £1-1.5m from memory, so won’t break the bank and gives them access to another c £20mn annual revenue, assuming 16-20 beds…

Not sure the expectation of an RNS this week is wise… could be but certainly not a given…

In the last Stockbox interview, 16th Feb…
46 mins: “…we are completing the optimisation work on that, not yet complete, we hope that it will be done shortly…”
“We hope to be able to ship our prototype platforms in the near future, but waiting for the final optimisation tests to be completed…”
“…LDT test (Lab developed test) waiting for US partner to complete that process”

He does also reference near term catalysts from 58 mins in, talking about getting “product in market through successful clinical trials”, more global partners etc…

Agree it’s not far off, but this week might be a little optimistic…

Hi DD, at the moment, I’m not seeing a raise being needed for a few reasons…
1) Current working capital and low overheads - I think the exec are something like £120k a year from memory,
2) The royalty model - currently 10% in China, 15% with Corepath in US, and seeking additional partners - is such that the productising will be done through their network of partners rather than Cizzle having to produce the products. They have mentioned additional partnerships to come this FY.
3) They will ship mAbs and reagents, which the partners will pay for in addition to royalty, difficult to know what that looks like in terms of the commercial arrangement, so difficult to determine whether cash impacting,
4) They have a 5% interest in Conduit Pharmaceuticals in the US who are due to list on the Nasdaq this FY. That is currently worth £3.25m to Cizzle once Conduit are listed so would create additional working capital should they need it in FY24.

I suspect in practice (just my opinion), once they can show 95%+ for identifying stage 1 lung cancer (and working on other bio markers), this gets bought by one of the big guys, I doubt they’ll be commercialising it themselves…just imho…

Posting this for newcomers re potential opportunity…

There are details in a prospectus last year plus various RNS updates and presentation videos kicking around so door, but below I took the current market opportunity as outlined by the company and pared it back significantly to be cautious…

- Highlighted cost of test = $100, so if you take just a proportion of that, say $20.
- 30 mn tests a year from China at 10% royalty = $60mn, let’s assume we add in other markets at a modest rate, US agreed, additional commercial partnerships due this year , so add in royalty in US of 15%, gets you to a modest $80mn p/a.
- That won’t happen overnight, so if we only saw 25% of this in the near term…that’s $20mn p/a.
- As a royalty, that’s straight through to the bottom line…if we assume a modest biotech EV multiplier of 10… that’s $200mn valuation…or c 60p share price. (as mentioned, my assumptions above are way below those cited by the company / market, but trying to be pragmatic).
- Given the demand, assuming they get taken out, anything from 50-100% uplift on SP (way higher if taken out earlier) - Amryt just went for 107% uplift.
(excluding use of IP to develop other bio marker tests e.g. breast cancer)

Personally see this going way way above 10p…it’s just how long it takes…key part is the completion of the assay optimisation and ability to ship platform to lab partners. Any assay % success of > 90% (lab tested 95%+) is huge…(not just commercially but also for society)…that’s before considering CIZ-1 for other cancers…

Evening lovelyboy…

Have you looked at LRGS the last couple of days? Interested in your view re any background accumulation? Thanks!

Thanks PTB, will have another listen.
General view from big bioscience guys (Thermofisher etc…) is that production time for Rabbit mAbs is c 3 - 4 months so that would tie in with your thoughts re current position.

While things have settled down, just adding some general info.
We know mouse mAbs have been successfully produced by Fair Journey, but has been mentioned about producing Ranbit mAbs. Tend to be better at producing antibodies for smaller peptides so elicit a better response than you’d see with mice, so improves efficacy.
Link just gives some context for those interested. In the near term, should get confirmation rabbit mAbs have been produced and these will be used for the ELISA test.

https://stjohnslabs.com/blog/the-benefits-of-choosing-rabbit-monoclonal-antibodies-over-regular-monoclonal-or-polyclonal-antibodies

On the conspiracy theory re pharma, there are loads of examples of pharma buying up diagnostic companies, just one example below:

https://investor.illumina.com/news/press-release-details/2020/Illumina-to-Acquire-GRAIL-to-Launch-New-Era-of-Cancer-Detection/default.aspx

I thought we’d concluded Martin Lang is from Leeds, Frazer’s company is just outside York?

The scope in terms of EV is vast, however….I would assume this will get acquired way before then…

Just a *** packet calc…
- Highlighted cost of test = $100, if you take just a proportion of that, say $20 .(price points invariably come down rather than up)
- 30 mn tests a year from China at 10% royalty = $60mn, let’s assume we add in other markets at a modest rate, and royalty in US of 15%, gets you to a modest $80mn p/a.
- That won’t happen overnight, so if we only saw 25% of this in the near term (3 years time)…that’s $20mn p/a.
- As a royalty, that’s straight through to the bottom line…if we assume a modest biotech EV multiplier of 10… that’s a $200mn valuation…or c 50p share price. (my assumptions above are way below those cited by the company / market, but trying to be realistic).
Which would be 20x above current level…
That’s without factoring in scope for CIZ-1 as a bio marker for other cancers e.g. breast

However, I don’t see this getting to market through Cizzle (and partners)…clear the next couple of hurdles and it’ll get acquired by one of the big guys - Eli, Merck, Pfizer, AZ etc… all increasingly looking at diagnostics.

Pure punt - 3-4x above IPO, so £100mn ish…??

Just creating debate :-)