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Rebound In Focus: ImmunoGen

|About: ImmunoGen, Inc. (IMGN)


This oncology-focused small cap concern has underperformed time and again, with shares having lost over 75% of their value over the past 5 years and shedding 40% of their value in 2019 alone. 

The stock took a major beating at the beginning of March after announcing that lead ADC mirvetuximab soravtansine flunked its phase 3 study (was being compared to chemotherapy in folate receptor alpha-positive, platinum-resistant ovarian cancer). Specifically, it failed to achieve PFS primary endpoint in entire study population or patients with high folate receptor alpha expression. However, it was noted that overall response rate was statistically significantly better in treatment group, 22% vs 12% with p=0.015).

ROTY Chat Nuggets

Biotech Phoenix on April 1st wrote in ROTY's Live Chat 

IMGN - Am I missing something here? $400 M market cap almost $300 M in cash. Phase 3 narrowly misses significance on PFS, but appears to hit on much more credible survival endpoint. Targeting platinum resistant ovarian cancer with high unmet need/no approved treatment options. Basically $100 M for an oncology company with a clearly active drug in a space with limited treatment options doesn't make sense

Key Catalysts

Meeting with the FDA to discuss potential path to registration for mirvetuximab as a monotherapy.

Presenting mature data from FORWARD II expansion cohort at ACO in June

Presenting full FORWAR I data and initial FORWARD II triplet data at medical meeting later in the year

CEO Mark Enyedy noted that in pre-specified subset of ovarian cancer patients with high folate receptor alpha (FRα) expression there are higher response rates, more durable responses and longer progression-free and overall survival as compared to chemotherapy. 

This would substantiate Biotech Phoenix' thesis regarding a swing trade here, namely that the company has an approval drug and is trading at an exceedingly cheap valuation.

Key Presentation Slides

--------Other Nuggets From Conference Call and Presentations

On the Q1 conference call, management noted that pursuing accelerated approval and conditional marketing authorization in the US and EU appear to be a reasonable pathway forward pending discussion with regulators.

Potential Plan of Action

As a speculative swing trade, this one makes sense (establishing pilot position near term and accumulating dips). The stock could potentially fill the gap from March back up to $5 or so.

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Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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