Oxford Biomedica Share Discussion Threads

[harry s truman] 24/3/2024 16:36

That's a great link and well worth a bookmark Phil.

(quote)

How are end-to-end CDMOs meeting CGT industry demand?

Currently, the industry has 5-10% of the manufacturing capacity needed for the CGTs now in development,7 but that is rapidly changing. CDMOs are expanding capabilities through acquisitions and mergers, incorporating development and manufacturing functionalities where gaps previously existed. Several significant investments have already taken place, including Thermo Fisher’s recent acquisition of viral vector manufacturing company Brammer Bio, and Pharmaron’s acquisition of US-based CRO Absorption Systems and a multi-purpose Liverpool-based biologics facility from AbbVie. Some CDMOs are building out their infrastructure through organic growth, although this is a slower approach.

(unquote)

Perhaps worth remembering that TF are not pure CGT and Pharmaron are not either.

If this strategy works out for OXB (and obviously most of us think it will), then their 4 regional centres (remembering also that Oxford is multiple locations) gives them an amazing pure play CGT CDMO footprint to capitalise upon.

[philh75] 24/3/2024 14:18

Do end-to-end CGT-Specialised CDMOs hold secret to success in the industry?

[harry s truman] 23/3/2024 10:32

The market isn't perfect is it Brucie? Obvious statement I appreciate, but a lot of investment sentiment revolves around the idea that the market "knows" and thus it's "all in the price" when really it doesn't and it isn't.

It might be true to a certain extent for enormous companies like (say) Coca Cola, where their every move is covered by a huge number of professionals and their market / business model of 100 years (or whatever) is very well understood. Not for OXB though.

I can pretty much guarantee you that nobody is (professionally) following OXB with the same level of interest and nobody from Numis will be looking at OXB's job ads.

The masses who bought during covid will have bought because of the word "vaccine" and little else, just like the panic buying in AI related stocks today. It's a fashion, or to quote another old adage "greed and fear". Which of course usually leads to too much either buying or selling and hardly ever a fair value.

If Numis were following the job ads, then they would have spotted the 2x fill & finish roles last week and the GMP Production Biotechnologist just now for "Largescale manufacture of ATMPs within GMP cleanroom facilities" (ATMPs are Advanced therapy medicinal products).

So, from the last 2 job ads alone we know (literally know) that OXB are on with something large scale which needs packing for patients - because they have told us via those ads. Numis will know SFA about that because they won't have looked. RBC as house broker might have some inkling from OXB, but they won't be looking at the job ads either.

You saw the other day both mine & Plutonian's guess at the likely candidate for the "late stage" mystery of this week's RNS. It's a bit of interest to guess, but it doesn't really matter who is correct (with the possibility here that it could also be both or neither of us), the great thing is that they have the work.

I'd point out that in Cabaletta's 10K they also said words to the effect that they were now preparing for commercial production, but I don't think the OXB RNS referred to them as that's quite a while yet on their trials - so I think they are simply planning ahead.

Bottom line here though is that (as we all understand) if sales don't bring in the revenue to cover our costs then it's a loss (as per the last 2 years).

At the interims Stuart gave us a clue of what those costs roughly are when he said that c£90m in revenue for 2023 + 30% growth would be "broadly breakeven".

I think that's as close as he will ever tell us, so he needs somewhere around £117m per year to avoid dipping into the cash pile for operations?

Yes we have added ABL since then, but Stuart said that was neutral for us and that IM were paying for the needed investment.

Also, if they do give up the lease on Yarnton this year, then that is less future cost, just as the loan will eventually be gone (along with the interest) - so an improving story.

On 5th March they guided a projected FY2024 revenue range of £126m to £134m.

It all depends on the capex I guess (outside of operations) and how that is presented, but I would hope that breakeven is achieved and fingers crossed for a little better.

[takeiteasy] 23/3/2024 10:16

There is a game of double bluff going on here to keep smaller investors out...it's along the lines nothing really is going to happen so switch off and come back in 6 months....seen it many times before and I am now going to add having taken some off the table recently...

all imvho and no advice intended of course :)

[brucie5] 23/3/2024 09:37

It is a huge mismatch. And no doubt points to the market's seeming incredulity.
Dragons Den the market is still saying, "I'm out, until you show me not just how you intend to get to those numbers, but the numbers themselves".
On the other hand as you say, that is the stark risk reward. The least you can say about Numis is that they offer limited downside.
😉

[harry s truman] 23/3/2024 00:13

As mentioned before, it's a bit of a legacy from when a particular OXB thread was more owner's club / enthusiast's group than a shareholder forum.

I find the Numis rating baffling. They rate OXB as hold, but with a target price lower than today - so in the simplest terms isn't that like telling their private clients to hold on for less?

Something is needed to spur them into changing their view, but what is anybody's guess. Maybe that wildcard.

The brokers / analysts will all use slightly different spreadsheets to crunch their numbers, but we shouldn't have a scenario where with the same OXB info RBC are 4x Numis.

If I understood Seb correctly in that recent presentation, then there is only one CGT CDMO. There are other CDMOs which will provide CGT services, but only as a part of their conventional other business. The one CGT CDMO is of course us, and it has occurred to me that this is perhaps what is spooking Numis - as all the others there have non-CGT business which would buffer them from any future sudden downturn in a CGT market (which is currently booming). But I'm grasping at straws with that one. I think perhaps it's more likely that they were annoyed with the difference between the consensus and the reported interim figures last year and this is their way of making a point. I'm not convinced by that argument either though.

If we go another fortnight without big news and it lets me fill this year's ISA at something like this price then I'll not complain. If, on the other hand, something huge happens in the next fortnight and the price jumps accordingly, then I'll not complain about that either.

[connello] 22/3/2024 16:34

Thank you Harry.

Unbelievable Stamina & yes to the Momentous wildcard

[harry s truman] 22/3/2024 15:53

I suspect Connello, that it's no single one thing which has kicked OXB, rather a pile-on of a lot of issues - some significant / some not.

The two biggest issues (with response) must have be these:-

If it was worry about the pre-covid (non-covid) work coming back then we already have more won.

If it was worry about our venture into AAV where we spent a lot and then saw the late stage customer which came with the deal go out of business, then that was a blow but other AAV work has been won (including that announced on Wednesday) and they have seemingly absorbed the loss of the Homology work with little more than what will be a line in the full year result about an impairment charge.

RBC the house broker thinks 740p short term.

Numis, who isn't the house broker and didn't call in to the last (interims) webcast thinks 180p over the same timescale.

I've often wondered why Numis have such a sceptical view of OXB, because they are plainly not seeing the same story as RBC, but unfortunately that is just one of those things.

At the moment all the circumstantial evidence is that OXB have an ever growing amount of work being signed at an unprecedented rate. Happy days for any CDMO.

Then there are the future wildcard possibilities - like maybe malaria.

What normally happens at the FY results (5 weeks on Monday), is that Stuart runs through the previous year (we know '23 is a loss already - but hopefully the last loss), then the guidance for '24 (which is basically 5 things).

So the growth figure he is expecting this year (we have already been told >35%).

Then the revenue forecast (we have already been told £126 million to £134 million).

Then a bit on costs and our cash (we know the cash was £103.7 million at year end, that there has been an injection from IM since and our own in-house drug development costs are gone now).

Then the EBITDA forecast (earnings before tax, etc.) which for the last two years has been a loss, but hopefully breakeven this year - or dare we hope better?

Then CAPEX forecast, which is mostly on what they will spend to create a US LentiVector hub in Boston and AAV / LentiVector hubs in Lyon / Strasbourg - but remember IM is paying for all / most of the French work. I guess the wildcard here would be if they feel a need to bring forward the final stage of OxBox as that would be expensive, but I think they likely have enough downstream for quite a while yet.

My reason for going through all that is that basically we already know most of it, or certainly most of it as of the dates OXB told us, but of course we all expect the story to be a little bit better by the presentation on the 29th April.

EBITDA is what everyone will look at, but the advantage over all the previous releases for the rest, is that the results is the presentation which gets most coverage.

Hopefully it will kickstart our rerating, but unless OXB do move to quarterly reporting then a lot of people (particularly those who follow Numis) may want to see the interim results posted (proving this) before they accept that the war is over.

Momentous wildcard news later in H1 could also do the same thing I suppose.

[brucie5] 22/3/2024 15:40

Maybe a handle forming?
In an idle moment found myself and the missus watching Dragons Den - and the responses made me think of OXB as they had certain common themes. I've reduced them to my own words.

- There has to be a clear journey from start to finish; or no-one can see where they're actually headed.
- It has to be a distinctive story, or risk being filched, eclipsed or pushed out by better versions
- It has to be one that can be ‘seen’ and shared imaginatively by those you wish to support you and accompany you along your way; or they won't 'get it'.
- It has to carry with it sufficient ambition (and means) both to inspire the end and to give fuel to the journey.

Discuss.

;)

[connello] 22/3/2024 14:18

All very interesting at the moment & the news feed is appreciated.

It is reasonable to expect more detail at the end of April & perhaps some figures added to this weeks news.

Share price is frustrating with whatever is going on in the back round will play out

Personally I am a lot happier here with the increasing contract wins & significant turnover increase & forecast of significantly more.

One way or the other the value will be unlocked

[harry s truman] 22/3/2024 11:18

Very limited interest here at the moment I appreciate (a sentiment which OXB seem unable do do anything about, regardless of this recent run of excellent news) but for anyone with a memory of last year, then we had that completely different (and seemingly unfathomable) year, when they posted just one RNS before announcing at the interims in September that they had won record work.

OK we had that AGM explanation of the "radio silence", but it didn't really explain the policy that well. Happily these days we seem to be awash with updates.

Back to the single RNS last year, which was of course for Cabaletta amending their supply agreement with us again.

The OXB RNS

(The old "undisclosed" chestnut there again, which we have read so many times in the past).

Cabaletta have their latest "tell all" Form 10-K out for the US regulators and there is a passage in it which I found interesting (remember here that the figures written in numerals are units of thousands).

"Oxford is eligible to receive regulatory and sales milestones in the low tens of millions and royalties in the low single digits on net sales of products that incorporate the Oxford technology. The Company can terminate the agreement at will upon advance written notice and subject to certain manufacturing slot cancellation fees. In May 2023, the Company amended the LSA with Oxford to expand the license to include the Company's CABA-201 program for an upfront fee of $500 and in August 2023, the Company and Oxford entered into a vector supply agreement for CABA-201, and a related second amendment to the LSA, with a total cost under the vector supply agreement of up to approximately $5,000, of which approximately $1,520 was recognized as expense in the accompanying statements of operations for the year ended December 31, 2023. In February 2024, the Company and Oxford entered into a third amendment of the LSA to update the patent schedule."

Interesting eh?

[plutonian] 21/3/2024 17:22

Yes, Carvykti is being marketed, but the launch is phased as they have not had Lenti supply and cell manufacturing sorted. They have declined to submit a NICE application until this situation is sorted, so the UK launch is still some way off.

[trickydicky1] 21/3/2024 15:13

Carvykti has been advertised on TV in the US since 4Q23 I understand?

[harry s truman] 21/3/2024 15:05

Plutonian,

Fair argument and given our position there is perhaps a very good chance here that we are actually in with both companies anyway. I could also add that OXB have never told us what all the BMS partnered indications are.

However, possibilities aside, my argument here (cue combover and call my bluff signature tune) would be this:-

We have an agreement with Arcellx and have made vector for them (known).

Arcellx's pivotal trial is just waiting for final data on last patients now and has orphan status for quick review (known).

Arcellx sold half that drug for an enormous amount to Kite (known) who will need a vector for their territories and as per Highlander, there can be only one.

Kite would need to come to OXB as our LentiVector will be tied to the approval and Kite would therefore be a new customer for OXB.

I did ponder this quite a bit before the previous post and I'm sort of convinced, but at the end of the day whether it's Arcellx & Kite paying us lots of money or J&J or someone else, I'm really not that bothered. It's the business which matters and if they start another long term commercial M&S deal in H2, then I will be more than happy.

[brucie5] 21/3/2024 13:29

Very good Plutonian, though all conjectural at this stage. Maybe the pieces are indeed coming together. Still a lot of fear around this recovery story, though and I think it will take at least the April results with solid figures to begin to dispel.

[plutonian] 21/3/2024 13:17

J&J has a $5B pa blockbuster target for Carvykti. We could be onto a big earner if we get a foot in the door.

[marwalker] 21/3/2024 12:40

Thanks for the deductive research Plutonian Why would it have such a big effect for OXB ?

[plutonian] 21/3/2024 12:34

"Recently, the Company signed a contract with a new undisclosed US-based biotechnology company for the manufacture of lentiviral vectors as the client prepares for the commercial launch of its CAR-T programme targeting multiple myeloma. Manufacturing will take place in Oxbox, the Company's Oxford-based manufacturing facility."

A "new" client, so I don't think Arcellx.

"prepares for the commercial launch", so I am assuming it is approved for marketing.

FWIW: my hope is that it is Carvykti (J&J).

My reason for hoping this is that J&J has previously highlighted 2 bottlenecks: cell manufacturing and lentiviral manufacturing.

They have recently entered an agreement with Novartis for cell manufacturing at Morris Plains, so that is sorted for half the market (Europe will be handled in Switzerland).

They want to bring viral manufacturing in-house, but their Dutch manufacturing facility earmarked for the Carvykti Lenti production will not be available until 2025. They have a 2 year gap to fill and need to keep first mover advantage to beat Abecma (BMS). It is a 50L suspension process, so something we can do easily.

If this is the case then this is BIG news!

[harry s truman] 20/3/2024 20:51

PB, it's good news but orphan status is a way to encourage companies to develop drugs which otherwise might not be an attractive potential market.

So it's nice that Cabaletta got that, but they still have to complete trials and get a good result before going to the FDA for review (basically applying for a medicine licence). It will be a while yet.

[pharmaboy3] 20/3/2024 19:58

HTTps://oxb.com/oxford-biomedica-expands-agreement-with-cabaletta-bio-adding-new-viral-vector-programme-for-cd19-car-t-therapies/

[cousinit] 20/3/2024 19:32

Apologies Harry - my thoughts were stuck in transit