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Ziopharm: Catalysts in T-Cell Therapy

04/06/2020 5:00 am EST


John McCamant

Editor, Medical Technology Stock Letter

Ziopharm Oncology (ZIOP) has been under major pressure after their recent follow-on-offering as well as the collapse in the overall market, explains biotech expert John McCamant, editor of The Medical Technology Stock Letter.

Many biotech stocks have been under relentless selling pressure as the broad markets suffer a broad lack of confidence and uncertainty due to COVID-19. The recent offering has not helped as the added dilution has very difficult for the market to absorb; on the other hand the company now is well financed.

The company also contributed by missing their timeline to start the Phase II TCR-T NCI trial in solid tumors with Dr. Rosenberg. Originally forecast to occur in Q4 of last year, the timeline has now been pushed out to the second quarter of this year. While the delay is disappointing, improved manufacturing processes are one of ZIOP’s advantages.

Once the Phase II NCI trial manufacturing is given the okay by the FDA, Dr. Rosenberg will begin patient enrollment. The same manufacturing improvements will be used in the ZIOP controlled TCR-T trial at MD Anderson that will begin as soon as manufacturing receives the FDA go ahead.

After the recent offering, the company has $177 million in cash which is projected to last until 2022.

2020 is a very important year as the company needs to deliver data to show that they have the potential to deliver third- or next-generation cell therapy technology that can deliver life changing T-cell therapy for solid tumors and at a price that will make the therapy broadly available.

The MD Anderson relationship only gets better for Ziopharm as they will start a CD19 CAR-T trial in Q2 there in which they will incorporate their cutting edge manufacturing process that can infuse a patient as soon as the day after gene transfer on site. The company is also establishing their own cGMP manufacturing infrastructure at MD Anderson.

The company has three potential upcoming catalysts as will have three controlled IL-12 data readouts in Q2, two in combo with PDL-1s and one monotherapy.

We also could get a press release from the NCI trial Phase II trial whenever Rosenberg thinks the therapy is working, which could be as soon as just weeks after the initial treatment. That will be a major positive event that we believe will be the inflection point for the company and the stock.

With T-cell therapy the theory is that you know pretty fast whether the T-cells are activated or not. In our view, the stock has multiple upcoming potential catalysts and the stock is significantly undervalued at current levels.

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