Altimmune: I Look For A Pulse While The Company Looks For A Partner

Jun. 26, 2019 2:17 PM ETAltimmune, Inc. (ALT)11 Comments


  • Altimmune has a short list of pending catalysts that are capable of transforming the company and the stock. However, the company has yet to close a deal.
  • The share price is still trading in a $2-$4 purgatory while the market waits for an announcement.
  • I take a look at the charts and review my plan to manage my ALT position while we wait for news.
  • On the other hand, the company has been making progress in their pipeline and is looking to progress their HepTcell program in a Phase II study.

I return to Altimmune (NASDAQ:ALT) to see what progress has been made on their to-do list. Unfortunately, at the top of the list is finding a partner for NasoVAX which is still unchecked. The company's lead product candidate remains on the shelf waiting for a partner to take the nasal flu vaccine through a second phase II and a pivot phase III study. As a result, the share price slowly bleeds. It appears the fate of NasoVAX will determine the fate of the share price. In the meantime, the company is hard at work developing the rest of their unique pipeline that continues to expand and mature, which cannot be disregarded due to their clinical implications.

I intend to go over the company’s recent developments that look as if they have gone unnoticed. In addition, I take a look at the charts to see if I can find any indications about where the share price is going.

Company Status

Business-wise, Altimmune still maintains a strong cash position with about $45M at the end of Q1. Altimmune appears to be managing their OpEx in order to preserve the company cash for the potential acquisition of new product candidates or platforms and also support the development of the company’s pipeline programs already in progress.

HepTcell Progress

Altimmune’s HepTcell program appears to be moving forward with the company looking to initiate a Phase II study in the U.S. in the near future. The company presented HepTcell data from the company’s Phase I at the International Liver Congress in Vienna, Austria, which didn’t do much for the share price or the sentiment. Despite the lackluster response from the market, HepTcell hit the company’s efficacy endpoint and demonstrated great safety marks. The data reveals that HepTcell in combination with IC31 facilitated substantial increases in T-cell activation matched to the baseline for those patients. However, HepTcell was overshadowed by other Hepatitis B products that could outperform or beat HepTcell to the market.

Although efficacy is the vital endpoint for a drug/therapy, safety is critical for immune-compromised patients who are dealing with a chronic infection. This is the case for Hepatitis B patients, where their immune system is not recognizing the infected cells. HepTcell was able to trigger the immune system but in a safe manner. Investors should keep this in mind as other products report their data… sometimes the high efficacy products come with some unwanted side effects and adverse events as the product works beyond the specified target. Basically, sometimes a hammer and chisel are more appropriate than a sledgehammer.

So what does this mean for investors? On the upside, the company believes they have a potential functional cure that can used in combination with contemporary therapies, including antivirals. Looking at the figure below, we can see the company’s key takeaways and outlook for HepTcell.

Figure 1: HepTcell Highlights (Source ALT)

Out the listed points above, I find the last one to be the most intriguing due to the potential for a partnership. Returning to HepTcell’s safety profile, we could see other HPV companies find HepTcell as a great addition to their programs because it is less likely to generate any safety issues. The partnering product is still relevant in the treatment paradigm and HepTcell is entered into the treatment paradigm.

ALT-702 Progress

The next big development is the company’s immunostimulant product candidate ALT-702, which is a selective dual TLR-7, TLR-8 agonist conjugate that is intended to work internally in the immunosuppressive tumor microenvironment to encourage local and systemic antitumor responses. The company has started preclinical work with ALT-702, which is expected to be a “first-in-kind” product candidate built on Altimmune’s synthetic peptide technology platform. ALT-702 looks to empower the immune system to identify the tumor antigens that already exist in the tumor and are being expressed.

ALT-702 is designed to create a localized inflammatory reaction inside the tumor using the TLR-7, TLR-8 dual agonist. Normally this dual agonist shouldn’t be employed due to the very strong inflammatory responses that can be serious if it is set loose systemically. However, Altimmune has anchored this dual agonist to the company’s peptide technology which will allow the dual agonists to stay within the injected into tumor and generate inflammation. This inflammation will rally T-cells to the tumor and recognize tumor antigens. Once the T-cells have acted on that treated tumor, they will be educated and primed to pinpoint other tumors and will act using that same mechanism.

What’s the big deal? ALT-702 is a big step for the company because it showcases their synthetic peptide technology platform and how it could make previously risky agents and make them safer. Immunotherapy and Immuno-oncology are a growing arena in healthcare. Attempting to regulate, guide, inhibit, excite, or educate an immune system is not easy and can be a risky endeavor. The wrong agent or immunostimulant can create a serious adverse event when the immune system goes haywire and starts attacking healthy tissue. If Altimmune can prove they can advance other immunostimulants using their synthetic peptide technology, we can expect an increase in attention from the street.

I am assuming these immunostimulants and agents are going to be the target of the proposed acquisitions that the company is currently working on. On the Q1 conference call, CEO Vipin Garg discussed the possibility of acquiring oncolytic viruses, which would be an interesting acquisition considering the small number of competitors and approved therapies.

Investors should be on the lookout for company news regarding an acquisition and what are the terms of the deal. These acquisitions could be a great opportunity or financial burden.

NasoShield Forgiven Progress

During Altimmune’s Q1 earnings conference call, the company updated investors on NasoShield, an intranasal anthrax vaccine that the company is developing in a partnership with BARDA. NasoShield has had a negative impact on the stock for quite some time as a result of the Phase I study presenting admirable tolerability, but with a lackluster immune response that did not match with pre-clinical data. Consequently, the company investigated the cause of this weak response by assessing the trial batch manufacturing and NasoShield administration. The company has reported that they have discovered that “the method of intranasal administration to the study participants had likely interfered with the ability of the vaccine to elicit a robust immune response.” Once the company has addressed the intranasal dosing procedure, they expect NasoShield to stimulate a “full immune response in humans.”

This is great news for investors for a few reasons. The primary reason is that NasoShield should be back in the clinic and hopefully still a potential product for BARDA to buy for the stockpile. This update also eliminates the superficial threat that NasoVAX will have the same problem as NasoShield. NasoVAX has had a perfect record in the clinic; however, it does use the same RespirVec technology and route of administration as NasoShield. Which is why I was so surprised when the NasoShield results showed limited efficacy, meanwhile, NasoVAX has a robust immune response. Hopefully, Altimmune will be able to get NasoShield back in the game sooner than later.


Looking at the daily chart (Figure 2), you can see why I am “looking for a pulse” in ALT. The share price has been sitting in a $2-$3 range for the past 6 months with a quick spike in March after the company revealed plans to partner NasoVAX.

Figure 2: Daily Chart (Source Trendspider)

Taking a closer look (Figure 3), we can see how the share price has been slowly bleeding since the March high.

Figure 3: ALT Daily Zoomed (Source Trendspider)

The share price should have strong support around $1.70 and strong resistance near $4, so the technicals don’t show any signs of a reversal anytime soon.


Despite the lack of partnerships, acquisitions, and price action, Altimmune still has a pulse and is continuing to execute their 2019 strategy. Altimmune is developing into a true immunotherapeutics company with several product candidates in development. Altimmune has been analyzing and evaluating potential acquisition and in-licensing candidates in order to build a robust pipeline of product candidates that should generate an elevated level of interest for the Street.

What’s Next? I am looking forward to the potential NasoVAX partnership that will help fund a larger Phase II study with a quadrivalent vaccine and then a pivotal Phase III study. Beyond NasoVAX, investors should remain vigilant in regards to the company’s planned acquisitions. The company appears to be moving towards oncology and could be looking to acquire or in-license multiple products to broaden this segment.

Is ALT a Buy? Considering ALT’s market cap is ~$29M and the company’s cash position is around $40M, I would say this is a good time to buy into ALT. Without a doubt, that cash position is going melt away with OpEx and acquisitions, but those expenses should create value to the pipeline that has a reestablished NasoShield back into the mix. Throw in the potential for NasoVAX to be partnered in the near future and you have an opportunistic buy at these valuations.

What’s My Plan? Regardless of my bullish sentiment, I’m not planning on adding to my ALT position before these potential catalysts occur. I have a large enough position for a speculative stock and I am happy with my average price. Without a NasoVAX partnership, I expect the share price to remain range bound or slowly bleed until the company is able to close the deal. Even if the company floods the wires with press releases and updates on other dealings, I am convinced the market wants to see NasoVAX partnered with a brand name vaccine company. Therefore, I will wait for confirmation that the deal is finalized before I click the buy button.

This article was written by

Biologics profile picture
Diagnosing the market to compound capital in the healthcare sector.

After years of working in the medical field, I have developed a passion for biotech and lifesaving therapies. Now, I am a full-time healthcare investor who is in search of the next breakthrough therapy, device, or pharmaceutical. My trade focus is around catalysts and potential acquisitions. In addition, I provide a marketplace service, Compounding Healthcare through Seeking Alpha.

Disclosure: I am/we are long ALT. 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.

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