Entering text into the input field will update the search result below

Affimed: Promising, Undervalued Immunotherapy Play With Multiple Catalysts Ahead

Dec. 06, 2018 5:52 PM ETAffimed N.V. (AFMD)BMY, MRK, NKTR, RHHBY, SGEN30 Comments


  • Impressive list of collaborators, including Genentech, Merck, Nektar Therapeutics, Columbia University and MD Anderson Cancer Center; and strong balance sheet with ~$139 million in cash.
  • Breakout ASH2018 with 6 presentations, including strong Keytruda/AFM13 combo data with 42-46% Complete Responses in R/R Hodgkin Lymphoma or approximately double the complete response rate of Keytruda as monotherapy.
  • Upcoming R&D Day should bring to light positive FDA discussions and elucidate registrational path for AFM13, including possible expedited development paths.
  • $1.35 billion of $5 billion in potential milestones from recent Genentech deal come before any commercial sales. PLUS, there could be meaningful royalties as well.
  • Expect clinical hold to be lifted on AFM11.

Affimed is an undervalued immunotherapy company that has attracted warranted attention from several smart players in biotech

In the world of immunotherapy where finetuning and engaging the human immune system to better recognize bad actors such as cancer, superior patient outcomes are on the rise, and what was previously considered impossible is now, thankfully in many cases, quite the opposite.

This article will cover a promising immunotherapy company focused on better NK cell and T cell engagement, Affimed NV (NASDAQ:AFMD). Affimed's approach utilizes CD16A engagers to overcome dysregulation and dysfunctionality of immune cells against cancers, thereby reestablishing recognition of cancer cells and reactivating immune cells to attack tumors. At its current valuation of ~$270 million with ~$139 million in cash and equivalents (as of Oct. 2018), and on the heels of its strengthening clinical and pre-clinical data at ASH 2018, Affimed represents a compelling investment opportunity.

Source: Affimed Corporate Presentation Jefferies 2018 London Healthcare Conference

To date, Affimed has attracted a solid list of industry collaborators, including Genentech (part of Roche Group: (OTCQX:RHHBY)), Merck (MRK), Nektar Therapeutics (NKTR), Columbia University, and the MD Anderson Cancer Center. From a Wall Street perspective, several smart institutions own equity, and the company is covered by five firms (Jefferies, SunTrust, BMO, Wells Fargo, Laidlaw); all have buy ratings with targets ranging from $6 to $15 per share.

Affimed had a breakout appearance at ASH 2018 held December 1-4 with 6 presentations covering their therapeutic candidates. Several of products in their pipeline - including AFM13, AFM13/KEYTRUDA Combo, AFM11, AFM13/Cord Blood NK Cells Off-the-Shelf Combo, AFM24, AFM26 - will be covered here; starting with one of the most important, the combination therapy of Affimed's lead candidate (AFM13) with Merck's KEYTRUDA.

Source: Affimed Corporate Presentation Jefferies 2018 London Healthcare Conference

AFM13 & Keytruda Combination - Generating cross talk

This article was written by

Have been investing in stocks for over 25 years. Worked on Wall Street on the equity side of the business. Now invest in both public and private equity. Try to identify Overlooked and Underfollowed names set up for outsized returns.

Analyst’s Disclosure: I am/we are long AFMD. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (30)

Time to buy. Price is Right
NDHT profile picture
"A complete response rate of 42-46% (approximately double the expected CR rate of Keytruda alone) and an overall response rate of 88%".

Although the data for AMF13 is impressive in r/r HL, it seems to me that Beigene's tislelizumab is even more impressive (monotherapy?), even though one should not simply compare different trials (BGNE's study is conducted for Chinese patients only):

"BGNE presented findings from its pivotal Phase 2 study for tislelizumab in r/r classical HL at the ASH. Patients experienced an ORR of 86%, with 61% reaching a complete response.
Dieter Hovekamp profile picture
Not so, if you refer to this globenewswire.com/... from BGNE.

As you already noted you need to look at the patient populations of the studies which are quite different. Affimed / Keytruda combination study only has BV failed (!) patients - i.e. you would need to subtract the BV rates in rr cHL (ORR 88% CR 50%) or at least BV after ASCT (ORR 75% CR 34%) (see BV in rr cHL for a review www.ncbi.nlm.nih.gov/... ) from what is seen with BGNE after ASCT or not an ASCT candidate patients only.

Also IMO be cautious with BGNE data as you may note the almost 25% of patients that dropped out of the BGNE study before the given statistics!
Kevin Porter profile picture
lol @ NDHT, please no more nonsense comments thank you
lionrock profile picture
Momentum traders continuing to bale especially given lousy market backdrop. A receading tide strands all ships as mcuh as a rising tide buoys all boats. The fundamentals of the company appear improved to this less than disinterested observer.
Kevin Porter profile picture
if this continues I might buyout the company myself
lionrock profile picture
Dieter Hovekamp profile picture
@Alexandria85 Thanks for sharing your impressions from the meeting. Can you say something about the external experts view regarding AFM13 use in mono- versus combination therapies - especially in regard to the astonishing company remark of preference versus ADCETRIS® (brentuximab vedotin) use in earlier lines of therapy?
Unfortunately Adi did it again with that long winded nothing burger 3 hr non-event... ;-(
Alexandria85 profile picture
Why do you think so? I was there and chatted with people. Thought it was really good
What are your thoughts about the event itself? Upbeat?
Alexandria85 profile picture
The atmosphere in the room was rather positive, attendance was the best I ever saw AFMD, which prompted me to congratulate the management. And analysts and investors were excited, and exchanging thoughts. Having said so, it’s still early. But @4-6 for the company, lots of upside, but need to be patient
Strike profile picture
Outstandingly profound and easy to understand article, even for laymen. AFMD is one of my largest biotech positions. Averaged down at $3 and looking forward to $50 in the coming years. Purposely refrained from taking profits on the recent run-up, and am laughing at the correction! This is a long term hold.
Martin Hansen profile picture
Thank you for that article. Long in AFMD and are hoping they will lift the hold soon. Have a nice day
MikeFromNZ profile picture
Truly outstanding article, bravo!
I hope this doesn't end up like CNAT. It is better to invest money in proven Biotech. I would rather invest in VCEL or TNDM. Proven Biotech are cheap because of 🐻 market beginning.
Very strong and thorough investigation into AFMD. You deserve a few beverages and next week off after putting all of that together. Thank you so much!
Very good write up of AFMD.
For once a decent article about AFMD. Good work. Like the fact that you have commentary about what Adi has been saying at the conference calls. Listening to the company's conferences really helps one understand how promising a company it is.

Hopefully today we will get a slight boost to the share price. Question is, what is the next catalyst after the R&D day? Not counting the chance of another partnership announcement it would seem that the next major catalysts are a while away. Biotech trades on news and however much the company is undervalued perhaps it is worth reducing positions during the upcoming catalyst desert and re-entering later? Any thoughts?

Also regarding the partnership, one gets the impression that Adi is determined to show more data, presumably for AFM24, before agreeing to better terms than are perhaps currently on the table. In which case, new partnerships may not be so immediate. They certainly aren't constrained for funds for the moment. Again, any thoughts welcome.
Adam May profile picture
The question of whether or not there is any impending catalyst is valid. There's certainly the potential lift of the AFM11 trial hold. Though that would appear to be an obvious significant positive catalyst, we have previously discussed the possibility that the positive reaction there could be muted...still, the potential is there for this at any time really.

More detailed AFM24 IND plans should be discussed soon. Will be interested to see if the market respects this asset early on. An EGFR targeted therapeutic with a novel MOA that synergizes with PD1 would be a heck of a lead candidate for a sub-billion dollar company. Still too early to salivate too much over that thought though.

Agree that we shouldn't hold our breath for another ROCK partnership any time soon. In the second half of 2019 this might come back onto my radar.

Otherwise, I'll wait until tomorrow to worry about future catalysts when we (hopefully) have a better idea about the multiple potential approval paths AFM13 could be taking in multiple different indications. Whether the stock is up or down, these plans will be interesting!
Could you summarize any catalyst-related takeaways from today's presentation? Thank you.
Kevin Porter profile picture
Amazing article, very solid indeed. A mistery how this has not yet run to a much higher valuation, I guess it's just slow and needs some more time. Patience is a virtue.
Adam May profile picture
Best AFMD article I've seen! You touched on all the relevant points and sifted through calls and presentations to include the most important statements coming from the C-suite. Appreciate the great summary!
I am always interested in hearing your opinion, what do you about today’s presentation?
dmc4321 profile picture
Well researched and structured. Thank you.

I think Dieter the AFMD Yoda has actually teased out who the unknown partner is.
Dieter Hovekamp profile picture
If it is not Roche / Genentech I would have to rethink many of my expectations and start to doubt my senses.
Kevin Porter profile picture
Does Dieter know he is the AFMD Yoda ?
Adam May profile picture
Agree, can't imagine it is anyone other than Genentech.
Dieter Hovekamp profile picture
The most current company presentation nicely explained - your article should be an eye-opener for many new and potential investors giving a really complete picture of Affimed. Old investors will find their DD confirmed and perhaps see some new or original insights to explore even more potential in their investment. I could not have done it better - thank you!
Alexandria85 profile picture
Excellent article! Thank you!
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.