Every man has inside himself a parasitic being who is acting not at all to his advantage.”― William S. Burroughs
Today we revisit Pieris Pharmaceuticals (PIRS) as we have not looked in on this intriguing 'Tier 4' biotech concern in some time. The stock also has shown some strength so far in September and is back over the $5 level.
Pieris Pharmaceuticals is an early clinical stage biotechnology company that is developing novel Anticalin-based therapies with an initial primary focus on immuno-oncology and respiratory diseases. The stock has a market capitalization of just north of $250 million.
Pipeline & Trial Milestones:
The company has a diverse pipeline and various partnerships based on its underlying technology around Anticalin proteins which are described below
To date, Pieris has received $120 million in upfront payments since January of 2017 and could potentially see over $5 billion in potential milestone payments that could be had in the future if all programs are pursued to fruition.
Among notable partnerships, the company has a collaboration agreement with drug giant AstraZeneca (AZN) around PRS-060. This compound is a localized IL-4Ra antagonist being utilized to address moderate to severe asthma. It is the first inhaled biologic focused on this target. Phase 1b results will be presented at the European Respiratory Society International Congress in Madrid on October 1st. As can be seen below, Phase 1 results for another compound (PRS-343) should be out by the end of the year as well. A Phase 2 study should kick off by yearend, which will trigger and undisclosed milestone payout to Pieris.
Pieris has an immuno-oncology co-development agreement with Servier that involves 5 specific programs including a potential best-in-class PD-1 checkpoint inhibitor. It also has retained U.S. rights for these compounds. It has a smaller partnering agreement in this space with Seattle Genetics (SGEN).
Analyst Commentary & Balance Sheet:
Since August 1st, three analyst firms have reissued Buy ratings on Pieris including Cowen & Co. and William Blair. Here is the commentary from H.C. Wainwright within their Buy rating and $7 price target
Valuation and risks to price target achievement. We reiterate our Buy rating and price target of $7. Currently our valuation is based on the three lead assets at the company: (1) PRS-060 for asthma, which is partnered with AstraZeneca contributing 33% of our valuation; (2) PRS-343 for oncology, which currently contributes 39% of our valuation; and (3) PRS-080 for functional iron deficiency anemia contributing 28% of our valuation. Our price target is based on our clinical net present value model, which allows us to flex multiple assumptions affecting a drug’s potential commercial profile."
The company ended the second quarter of 2019 with approximately $100 million in cash and marketable securities on the balance sheet, down from just under $111 million at the end of the first quarter.
Pieris is obviously a very early stage developmental concern. However, it has intriguing technology, partnerships with several major drug makers, and a huge amount of potential milestones should it see some of its compounds make it to approval and commercialization. We continue to view the risk/reward profile as favorable and look forward to continue to keep an eye on Pieris as its pipeline develops.
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Those who exploit the suffering of others are called parasites. Those who exploit their own suffering are called artists.”― Marty Rubin
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Thank You & Happy Hunting,
Analyst's Disclosure: I am/we are long PIRS.
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