DEDUCED RECKONING: Northwest Biotherapeutics receives license for Sawston UK plant
I last published a column on NWBO on Dec. 24, 2020, when the stock was $1.40. The stock traded up 50% to $2.15 in May before the entire biotech sector took a nosedive in the second half. I have received letters from readers asking about NWBO as it was swept down with the group.
For comparison: Cathie Wood’s ARKG Genomics ETF peaked on Feb. 10 at 115 and is now trading at 62, a decline of 46%. XBI, the S&P Biotech Select ETF, has dropped 34% from 174 in February to 115.
Just before Christmas, NWBO received approval from the UK’s MHRA licensing its Sawston UK plant to continue production for compassionate use (referred to as “specials” in the UK) for its personalized vaccine for glioblastoma, DC VAX-L. Prior to its approval, individuals may now apply in the UK to use the drug. The Sawston license is for a clean room environment using the same ongoing batch process that is monitored by a trained technician, similar to its lower volume facility in London for such patients. In August 2020, NWBO acquired Flaskworks from Corning Glass seeing the potential to eventually automate its production of personalized vaccines. In the Flaskworks system, the vaccine material is processed in a sealed container system which lends itself to replicating procedures that optimize purity and reduce the risk of contamination. This could ultimately lead to an automated assembly line process as the system is refined. Note that both the Sawston plant and the Flaskworks technologies are directly owned by NWBO.
NWBO announced it had locked the data from its 15-year Phase 3 trial of DCVAX -L in glioblastoma in October 2020. We still await the results. The average patient lives only 15-18 months after surgical resection of their tumor, radiation and dosing with Merck’s Temodar, the standard of care. In those 15 years since Temodar was approved, over 400 trials in glioblastoma have failed to improve that dreadful outlook. DCVAX-L is non-toxic with a very positive safety profile. It doesn’t help all patients but some of those who survive have gone on to live cancer free for more than a decade.
Most cancer treatments are prohibitively expensive. As for the expected cost of DCVAX-L, judging from talking with people who have previously undergone treatment in the UK, I believe t it is possible that DCVAX-L might be priced at half the cost of the approved immune therapies offered by Big Pharma.
NWBO now has more than 200 process patents in countries around the globe. This year Japan, Israel, Russia, the U.S., the U.K. and Canada have granted additional patents. The Flaskworks patent portfolio has the potential to be licensed to others in the future providing a possible future income stream. As an example in another sector, QUALCOMM has both produced its own chips for cellular technology through the years and enjoyed a very rich stream of licensing royalties for its patents. In 2019, Apple is estimated to have paid QCOM between $5 billion and 6 billion for infringing QCOM’s telecom patents. It agreed to pay $8-9 per phone going forward.
It’s been reported that release of the Top Line Data (TLD) in a peer reviewed medical journal could be a likely next step. This could be followed by: A conference presentation or several to explain the findings; filing of the drug application, likely first in the U.K.; uplisting of the stock from the pink sheets back to a major exchange.
Until DCVAX is approved, this stock is not without risk. We continue to own NWBO.
Joan Lappin CFA has been called an “investment guru” by Business Week and a “top manager” by the Wall Street Journal. The Sarasota resident founded Gramercy Capital Management, a registered investment adviser, in 1986. Email her at JLappincfa@gmail.com. Follow her on twitter: @joanlappin. Her past columns appear at heraldtribune.com/business/columns.
This article originally appeared on Sarasota Herald-Tribune: JOAN LAPPIN: Biotech firm NWBO gets UK approval for special treatment
