Multiple of current sp20 Sep 2016 12:20
Rex Pharma PLC (LON:REDX) has a ‘potent combination’ of assets, according to the drugs analyst at City broker Cantor Fitzgerald.
Providing the backbone to Dr Brian White’s 105p a share valuation is a potentially “best in class” Porcupine inhibitor, which should undergo first-in-human studies early next year.
Porcupine inhibitors are a new method of fighting the killer disease.
They work by targeting cancer stems cells that can often lie dormant after traditional treatment and are associated with a recurrence of the illness.
Kill the stem cells and you have a chance of eradicating the disease completely.
Novartis currently is the only drug major with a Porcupine inhibitor in the clinic and Redx is using the Swiss giant’s compound as its benchmark “with a view to coming up with something better”.
Cantor’s White said these Porcupine drugs could be used in combination checkpoint inhibitors to increase the potency of the cancer treatment.
He added: “Cancer R&D has heavily featured the pharmaceutical industry’s continued quest to find appropriate combinations with checkpoint inhibitors and which has resulted in several high profile and valuable transactions.”
The 105p net present value stands at a significant premium to the current share price of 35.6p.
Also in the Redx portfolio is a next-generation of Bruton’s tyrosine kinase (BTK) inhibitors for the treatment of leukaemia.
Redx’s BTK will be one of the second-generation of compounds with fewer side-effects than the market leader Imbruvica (Ibrutinib). More importantly, the company’s drug is targeted at overcoming resistance that patients have developed to ibrutinib.
Redx hopes to have selected a candidate by the end of this year ready to go into the clinic in early 2018.
That’s far from the end of the story for the oncology pipeline, which includes a smoothened inhibitor for basal cell carcinoma (a form of skin cancer).
It is also developing a compound that inhibits IDO, a pathway active in many cancers and it is working on a number of targets in the emerging area of immuno-oncology.
In anti-infectives, Redx has teamed up with the Liverpool and Broadgreen University Hospital NHS Trust to develop drugs to tackle gram-positive bacteria such as MRSA.
"Critically, these are novel drug scaffolds, so they are potentially the first new class of antibiotics in a generation,” said chief executive Neil Murray in a recent interview.
“One of the main reasons that we are facing such a critical shortage of antibiotics that still work is because our industry has been unable to create new classes of drugs.”
Not just that, they are designed in a way to make it very difficult for the bacteria to evolve resistance. Redx also has a programme developing drugs to combat Gram-negative strains. It is already having some early success with gonorrhoea wh
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