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goetzpartners securities Limited
Abivax SA (ABVX-FR): ABX464: sustained safety and benefit in inflammatory
bowel
11-March-2019 / 14:54 GMT/BST
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*Published to the market and investors on 11th March 2019 @ 2.04pm (GMT).*
*Abivax SA (ABVX-FR): ABX464: sustained safety and benefit in inflammatory
bowel*
*Recommendation: OUTPERFORM*
*Target Price: EUR28.80 *
*Current Price: EUR8.93 (CoB on 8th March 2019) *
*KEY TAKEAWAY*
With Data presented at the ECCO (European Crohn's and Colitis Organisation)
support the potential of Abivax's ABX464 in ulcerative colitis ("UC") While
response to biologic therapies such as anti-TNF often wains with time and
alternatives including JAK inhibitors are associated with serious safety
issues, six month Phase 2a extension data indicate safety and progressive
improvements from ABX464 in key UC disease markers, including Mayo Score and
faecal calprotectin over the eight months since the original trial began. We
are optimistic that clinical studies planned for 2019E should confirm the UC
results and may suggest efficacy in Crohn's Disease and rheumatoid arthritis
("RA"). There appears a firm basis for a licensing / development deal expected
during 2019E in a > $70bn market. We reiterate and maintain both our
OUTPERFORM recommendation and EUR28.80 target price.
*Anti-inflammatory benefits compare well to current drugs -* Data from the
original 2 month Phase 2a (Reviewed in our company update note - published on
22nd Jan 2019 [1]) indicated the impact on healing and clinical outcomes of
ABX464 that already compare well with and could exceed the benefits of
marketed products particularly other oral drugs like tofacitinib from Pfizer
recently approved for used in steroid refractory patients. These new data
confirm and extend these results. 19 of the 22 patients who joined the open
extension trial are still opting to remain on the drug after an average of 10
months treatment; suggesting continued benefit.
*Safe and well tolerated* - This extended UC Phase 2a trial and those in HIV
suggest that the drug is safe and well tolerated with no evidence of the
infections and other serious issues associated with the anti-TNF antibodies or
small molecule anti-inflammatory drugs like tofacitinib. The original 12-month
extension study with the Phase 2a patients has now been extended to 24 months
based on ABX464's continued safety and efficacy.
*Large unmet need in substantial market -* Although anti-TNF drugs have
transformed inflammatory therapy, 30% - 40% of patients still fail or cease to
respond. There is an absolute need for a safe effective orally available
alternative.
*Still potential in HIV -* Although the major focus has shifted to
inflammation, ABX464 still has potential in HIV where the drug has already
shown potential in not only reducing the latent HIV reservoirs that are left
untouched by current therapies, but also possibly the chronic inflammation
with which these are associated. A high dose (150mg) 16-week study aims to
confirm these effects during 2020E.
*Further data and partnering expected -* It is hoped that a dose-ranging Phase
2b trial planned in 232 patients will confirm the benefits of ABX464 in UC
with PoC Phase 2a trials planned in Crohn's and RA all reporting 2020E. A
licensing / development partnership is expected by Abivax during 2019E.
*Under-valued at current levels* - Currently funded through Q4/2019E, the
company aims to secure long term funding through substantial upfront and
development milestones though ABX464 partnering in 2019E. We are optimistic
that this will be achieved based on the strength of the UC Phase 2a data. DCF
analysis indicates a current valuation of EUR28.80 rising to > EUR50 / share
with PoC in Crohn's and RA. We reiterate both our OUTPERFORM recommendation
and EUR28.80 target price.
Kind regards,
Chris Redhead | Analyst
goetzpartners Healthcare Research Team | Research Team
goetzpartners securities Limited
The Stanley Building, 7 Pancras Square, London, N1C 4AG, England, UK.
T +44 (0) 203 859 7725 | chris.redhead@goetzpartners.com /
healthcareresearch@goetzpartners.com
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786153 11-March-2019
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