A Biotech Innovator

Written by GSCR Staff   
Tuesday, 16 April 2013 10:22

Good Morning.  Today’s featured stock is Vical, Inc. (NASDAQ – VICL - $3.93).   The Company is a biopharmaceutical firm that develops products based on its DNA delivery technologies for the prevention and treatment of serious or life-threatening diseases.

Vical has a strong pipeline headlined by its Melanoma candidate, Allovectin.  Allovectin is a DNA based immunotherapy designed to stimulate immunization in tumors.  Phase 3 trial results are expected sometime late 2Q13 or early 3Q13.  The growth potential in the melanoma market in the U.S. and EU is huge, potentially increasing to $2.5 billion in the next 10 years, which would be 100% from current levels.  The Allovectin product alone could provide $500 million in sales for Vical.

  Additionally, Vical has received $22.6 million for licensing rights from AnGes MG, Inc. to license the rights in Japan and other Asian countries.

Vical is developing other products that also offer tremendous revenue potential.  TransVax is in Phase III trials and is a DNA-based vaccine that is targeted for use by hemtopoietic stem cell transplant recipients.  Vical will enter Phase II trials for TransVax for solid organ transplant recipients sometime in the middle of this year.  Revenue potential for this product is $125 to $150 million in payments from an existing licensing agreement from Astellas (OTCBB: ALPMF). 

Vical also has the ONCEPT product which is actually targeted at treating dogs with oral melanoma and farm raised salmon susceptible to the necrosis virus which has already been approved in the U.S. and Canada.  Finally, the Company is developing a vaccine targeted at HIV therapy that is in Phase II trials.

Given the solid development pipeline and upcoming milestones, we believe that VICL could trade well above the $5.00 during 2Q13.

 

Have a great start to your week!

 

Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.

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