August 8, 2013
Nuvilex Is the Rodney Dangerfield of Biotechs
I was recently thinking about the time I had the pleasure of sitting in the front row of a stage in Las Vegas to see a Rodney Dangerfield performance. Interestingly, the recent trading of some of Nuvilex Inc.’s (OTCQB – NVLX - $0.148 – Spec Buy) biotech sisters has prompted me to realize that Nuvilex is the Rodney Dangerfield of biotech stocks. Let’s face it, the Company gets no respect.
That is all about to change. In fact, we predict that Nuvilex will ultimately turn from Rodney Dangerfield into Cinderella.
If you remember your fairy tales, some of Cinderella’s (step) sisters are shining stars, and undeservedly so. Still, Cinderella stays the course, perseveres, and emerges triumphant and is valued as per her true worth, trumping the others. The unbelievable trading and valuation of one of Nuvilex’s sister-stocks this quarter as compared with the current valuation of Nuvilex itself is reminiscent of that story.
Inovio Pharmaceuticals, Inc. (NYSE – INO) is a great and exciting company in its own right. It is an early stage vaccine developer whose shares have enjoyed at their recent peak, a nearly 300% increase in share price and valuation. Specifically, Inovio is revolutionizing vaccines to prevent and treat today's cancers and challenging infectious diseases. Its SynCon® vaccines, in combination with its proprietary electroporation delivery, are generating best-in-class immune responses, with therapeutic T-cell responses exceeding other technologies in terms of magnitude, breadth, and response rate. Human data to date have shown a favorable safety profile. Inovio's lead vaccine, a therapeutic against human papillomavirus (HPV)-caused pre-cancers and cancers, is in phase II clinical trials. Inovio’s other phase I and preclinical programs target prostate, breast, and lung cancers as well as HIV, influenza, malaria and hepatitis C virus. As a vaccine developer, it has a number of collaborations with leading institutions and companies.
While the magnitude of the rise has baffled some market watchers, one of the major drivers was news that in preclinical animal models, Inovio demonstrated that its vaccine showed the potential to reduce tumors and prevent tumor recurrence by a wide margin versus the peer technology.
Nonetheless, if success in an animal model cancer study and a vaccine in Phase II clinical trials are worth a peak market cap of over $500M, shouldn’t Nuvilex be worth at least half that much considering it is further along the development path, instead of just $70M?
After a series of fits and starts, Nuvilex now owns exclusive rights to a live-cell encapsulation platform technology for all cancers and that has not only successfully completed Phase II trials for advanced, inoperable pancreatic cancer, but comprehensive animal trials for mammary (breast) cancer, and is on the verge of acquiring similar rights to the technology to fight diabetes. Moreover, management is gearing up for next stage of trials for pancreatic cancer due to its outstanding Phase II trial results.
Perhaps if the Company had gone through these steps in quicker fashion or its stock was uplisted, its market cap would be at a similar level to that of Inovio. Still, Inovio has been around for 30 years, so it has taken them quite some time to get to this point, despite its amazing rise in 6 weeks.
You Might Also Like
Senior Analyst: Robert Goldman
The information used and statements of fact made have been obtained from sources considered reliable but we neither guarantee nor represent the completeness or accuracy. Goldman Small Cap Research did not make an independent investigation or inquiry as to the accuracy of any information provided by the Company, or other firms. Goldman Small Cap Research relied solely upon information provided by the Company through its filings, press releases, presentations, and through its own internal due diligence for accuracy and completeness. Such information and the opinions expressed are subject to change without notice. A Goldman Small Cap Research report, update, article, or note is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed.
This publication does not take into account the investment objectives, financial situation, or particular needs of any particular person. This report does not provide all information material to an investor’s decision about whether or not to make any investment. Any discussion of risks in this presentation is not a disclosure of all risks or a complete discussion of the risks mentioned. Neither Goldman Small Cap Research, nor its parent, is registered as a securities broker-dealer or an investment adviser with FINRA, the U.S. Securities and Exchange Commission or with any state securities regulatory authority.
ALL INFORMATION IN THIS REPORT IS PROVIDED “AS IS” WITHOUT WARRANTIES, EXPRESSED OR IMPLIED, OR REPRESENTATIONS OF ANY KIND. TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE FOR THE QUALITY, ACCURACY, COMPLETENESS, RELIABILITY OR TIMELINESS OF THIS INFORMATION, OR FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT MAY ARISE OUT OF THE USE OF THIS INFORMATION BY YOU OR ANYONE ELSE (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF OPPORTUNITIES, TRADING LOSSES, AND DAMAGES THAT MAY RESULT FROM ANY INACCURACY OR INCOMPLETENESS OF THIS INFORMATION). TO THE FULLEST EXTENT PERMITTED BY LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY, OR OTHER THEORY WITH RESPECT TO THIS PRESENTATION OF INFORMATION.