ImmuPharma: New Research Team To Access Novel Peptide Platform

ImmuPharma has announced the establishment of a new research team within the IECB incubator at the University of Bordeaux, in collaboration with the CNRS. This team will research the potential of ImmuPharma’s co-patented Urelix peptide technology. In addition, at its AGM the company commented on the progress it has made since the start of 2013, and it expects to announce results of its Phase I/IIa cancer trial and an update on Lupuzor soon. We find it encouraging that ImmuPharma is exploring its other assets while Lupuzor awaits Phase III trials. While cautious of the risks, our stance remains Buy.

Access to Pioneering Research

ImmuPharma’s wholly owned subsidiary, UREKA, has established a research team within the Institut Européen de Chimie et Biologie (IECB) in collaboration with the CNRS team of Dr. Gilles Guichard, one of the company’s scientific founders. This provides access to both professional laboratories and scientists and comprises candidates sourced from Dr. Guichard’s laboratory and other universities. This team will investigate the potential uses of ImmuPharma’s previously announced prospective Urelix peptide technology, which it is thought can be used to mimic peptidesusually within the configuration needed to bind to their receptor, to increase 
their stability versus enzymatic degradation (the breaking down of peptides into their amino acid ‘building blocks’) and their efficacy. The first uses of this technology are being explored in treating diabetes, however it is thought it could also be used to fight viruses by blocking entry into cells. With potentialfinancial support from the French Aquitaine region, this dedicated research team working in collaboration with the CNRS should fit with the company’s strategy of keeping R&D costs low while focusing on applied research.

AGM Statement Focuses on Progress Made

The statement made at the company’s AGM by CEO Dimitri Dimitriou concentrated on the progress ImmuPharma has made since 2013, including developments with Lupuzor, the £50m funding facility agreed with Darwin, the establishment of a prestigious Scientific Advisory Board for Lupuzor and the recently announced grant of patents within its Nucant peptide portfolio. 
The company expects to provide an update for Lupuzor shortly, and will report results from its Nucant cancer phase I/IIa trial in the near future.

Valuation

Our valuation stays flat at £164.5m (previously £164.6m) as an increase in our GBP:USD assumption of $0.01 to $1.71 is offset by ImmuPharma moving closer to our expectations of first cash flow; our target price remains at 200p. Our forecasts change accordingly. We highlight that the company currently generates no revenues and due to the nature of drug development 
companies, any alterations to our expectations for development could affect our valuation materially. However, with this in mind our stance remains Buy.