Preparing for next clinical studies

Scancell is a clinical stage pharmaceutical company developing two distinct flexible cancer immunotherapy platforms, each with broad applications. ImmunoBody is a DNA vaccine which stimulates high avidity anti-tumour T-cells for use as a monotherapy or in combination with checkpoint inhibitors. Moditope targets modified antigens and stimulates powerful anti-tumour T-cell responses for use in advanced and hard-to-treat cancers. Both platforms are targeting multi-billion dollar markets. Results provided an update on clinical studies and future plans to progress both platforms to the next development stage.

• Strategy: Scancell is developing two proprietary immuno-oncology platforms which target cancer cells directly to produce potent T-cell responses. Both technologies are highly flexible, potentially targeting many types of cancer. The initial aim is to complete proof-of concept trials in five different indications.
• Results: During fiscal 2017, management has been preparing for the next stage of clinical development of SCIB1, SCIB2 and Modi-1. In 2017, the cash burn was -£3.84m, mostly related to R&D investments, leaving the company with just under £2.7m cash subsequently boost by the £5m Placing (£4.7m net proceeds).
• Clinical trials: Encouraged by the exceptional results from its SCIB1 Phase I/II trial in Stage III/IV melanoma patients, Scancell has been preparing additional clinical studies, using both proprietary platforms. An IND for a Phase II trial using SCIB1 in combination with a checkpoint inhibitor is set to be submitted in 1Q’18.
• Risks: Scancell is an early-stage drug development company which carries a high risk that a product might fail in clinical trials. Its focus on cancer immunotherapy is an extremely exciting, but competitive, field. More capital will be required to advance its proprietary assets further along the value chain.
• Investment summary: Scancell is trading on an EV of £32m, compared to a cumulative investment of c.£29m to get the company where it is today, which is extremely low compared to its relevant peers. Scancell’s proprietary technologies are in the ‘hot’ area of immuno-oncology and targeting markets of unmet medical need. Given that big pharma is willing to pay handsomely for such validated assets, we foresee considerable upside potential in the shares.