H.C. Wainwright has initiated coverage of Heat Biologics (NASDAQ:HTBX) with a “buy” rating and a 12-month target price of $13, based on a risk-adjusted revenues and earnings per share multiples valuation methodology. The stock closed at $6.43 on Monday.
Heat’s biotechnology franchise is focused around allogeneic, off-the-shelf immunotherapies based on a novel Immune Pan Antigen Cytotoxic Therapy (ImPACT) technology platform. The two most advanced product candidates, HS-110 for non-small cell lung cancer (NSCLC) and HS-410 for bladder cancer, are currently in Phase 2 clinical trials with multiple data readouts expected over the next 12-to-18 months.
“Given the company’s focus on combination immunotherapies, the targeting of unmet medical need diseases, and a cash position of $21.1-million (that we expect could sustain operations until mid-2016), we believe Heat Biologics represents an undervalued player with significant upside for the long-term investor,” writes analyst Reni Benjamin.
“In our opinion, combining the ImPACT platform with checkpoint inhibitors represents a novel strategy to resurrect the cancer vaccine field, and could help restore the ‘immuno-potential’ of each patient,” he added.
To this end, a randomized Phase 2 trial of HS-110 in NSCLC is scheduled to enroll approximately 123 patients, with data from the first 40 patients expected later this year. In addition, a Phase 1b trial to evaluate HS-110 in combination to multiple immuno-modulators in NSCLC was recently initiated by the company.
