The fight against cancer has moved into a new phase as drugs are developed that use the body’s immune system to tackle the killer disease.
In May, investors got behind the business, backing a placing and open offer of new shares that brought in £8.7mln before expenses.
That cash will fund early clinical trials of a drug generated using its Moditope platform as well as supporting the development of its more advanced assets.
They are SCIB-1 and SCIB-2, which target and stimulate existing cells that make up the body’s defence mechanisms.
At the turn of the year, Scancell reported the “compelling” results of a Phase I/II trial of SCIB-1, and the immunotherapy has continued to impress since.
Meanwhile, last December, Cancer Research UK agreed to fund and sponsor a Phase I/II lung cancer clinical study of its SCIB-2 vaccine in combination with another type of drug called a checkpoint inhibitor.
Lung cancer is a killer
Lung cancer remains one of the most difficult cancers to treat and accounts for more than a quarter of all cancer deaths.
That’s more than breast, prostate and colon cancers combined. Around 228,000 people receive a lung cancer diagnosis in the US alone and more than 160,000 will not survive.
A read-out from the study is expected in the first half of next year.
ImmunoBody and Moditope
Both SCIB-1 and SCIB-2 emerged from Scancell’s ImmunoBody platform.
MODI-1 is its first drug using the company’s Moditope technology. Initially, it will be deployed in the clinic to treat breast and ovarian cancers as well as sarcoma (tumours found in fat, muscle, bone and tendons).
MODI-1 acts to stimulate the production of killer CD4+ T cells that seek out and kill tumour cells that would otherwise be hidden from the immune system.
Scientists at the Karolinska Institute, led by Professors Lars Klareskog and Vivianne Malmström, uncovered an essential role for citrullinated proteins, which are normally associated with arthritis, in this process.
On Thursday (Aug 9), the company extended its collaboration with the rheumatology department of the Swedish medical research university.
The share price, which has fluctuated between 10-16p in the past year, appears to have found a level recently at around 12p.
At that price, the company is worth just under £44mln. Whether this is a fair valuation of the business is open to interpretation.
Hard to value
Normally, you would carry out discounted cash flow analysis to assess just what Scancell’s assets are worth.
But as Hardman, the City research house pointed out in a recent note, the company’s innovations are at too early stages to be subjected to this sort of analysis.
Instead, it’s probably worth looking at the trends within the industry and the deals being done.
Last year, there were 35 transactions in the oncology sector in excess of US$1bn, according to EvalutePharma,
Of that total, 32 were focused on immuno-oncology. In other words, this is a particularly active (and potentially rewarding) area of R&D.
As Hardman analyst Martin Hall said in his note: “Scancell’s proprietary technologies are in the ‘hot’ area of immuno-oncology and targeting markets of significant unmet medical need.
“Recent deals have demonstrated the price that big pharma is willing to pay for validated assets in the field.”