Pharmacyte Biotech Inc (OTCMKTS:PMCB) just reported that it’s the recipient of what’s called the Pipelines of Promise Award from BIO International. There are a few benefits associated with this award, including what looks like some potential exposure to the medical community in the indications that Pharmacyte is targeting, and this brings with it the potential for some budding collaborations (and maybe some speculative capital inflow). It’s not that important from our perspective, however.
Sure, it’s a bit of a boost, and it’s given management an excuse to put out a press release, but it’s not the news shareholders were looking for.
That’s not to say this isn’t an opportunity to pick up an exposure at what looks to be a large discount to potential value – with potential value rooted in what we see as an inflection point for Pharmacyte. Unfortunately, we don’t know when this inflection point will come. Management has sort of gone out of its way to make sure we have no idea, which is a bit frustrating, but in some ways justifiable, but the thesis still stands – when it hits, we’re going to see some immediate upside in Pharmacyte’s market capitalization. For a company that’s currently trading at a close to 45% discount to its 2017 open, said upside will be a welcome reprieve for the longer term holders.
So, what are we talking about?
We’re looking at an IND submission that will mark a major progression towards commercialization of the company’s development technology.
For those that missed our last coverage on this one, we noted that management had (then) put out a release detailing the outcome of a pre-IND meeting with the FDA, regarding the application of its Cell in a Box technology to a pancreatic cancer indication. Cell in a Box is Pharmacyte’s flagship technology, and it’s designed to offer a side effect-less, or side effect-reduced, alternative to current standard of care therapies in the cancer space (read: chemotherapy) right now.
The treatment involves encapsulating genetically engineered human cells that convert an inactive chemotherapy drug into its active or “cancer-killing” form, and then introducing these encapsulated cells (these are the so called cells in a box) to the cancerous region of the body. After introduction, the patient is then given a standard chemotherapy agent intravenously, but at a third of the dose of the normal regimen. In normal chemotherapy, the agent is activated by the liver. This first pass activation necessity is why so much is required. With Pharmacyte’s treatment, however, the encapsulated cells act as a sort of artificial liver, and active the agent as and when it reaches the cancerous site.
Again, for those that missed our previous coverage, it might be worth jumping back to catch up on the situation here. As a quick intro, however, the outcome of the pre-IND meeting was that Pharmacyte essentially has a fast track straight to pivotal trial, so long as it can tick a few (relatively simple) boxes before it starts the trial.
It’s got to demonstrate that it has ticked these boxes in the IND that it has to submit before it can start the trial, and that’s why we’re so focused on this submission as a catalyst for Pharmacyte near term. Back last month, however, as part of this release, Kenneth L. Waggoner, CEO, basically told markets that he’s not willing to serve up any insight as to when we might expect this submission. He said it’s based on the necessity for a number of other parties to fulfill parts of the equation before the IND can happen, and that’s reasonable – to an extent.
Reasonable, but frustrating.
So what can we do? Well, anyone looking to pick up an exposure to what we see as an inevitable jump on IND submission announcement (and we think the company will submit, then announce the submission, as opposed to announce a date and then submit on that date), has the opportunity to do so at current prices.
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Disclosure: We have no position in PMCB and have not been compensated for this article.