NEW YORK, Aug. 05, 2022 (GLOBE NEWSWIRE) -- Diamond Equity Research, a leading equity research firm with a focus on small capitalization public companies has released update note on Arovella Therapeutics Limited (ASX: ALA). The update note includes information on the Arovella Therapeutics’ financial results, management commentary, recent developments, outlook, risks, and our revised valuation estimates.
The update note is available here. Highlights from the note include:
- Summing Up a Productive Year - The company ended quarter four and year 2022 with several developments within both its OroMist and cell therapy pipeline candidates. The company’s lead candidate within the OroMist platform, Zolpimist®, was commercialized by its licensing and distribution partner STADA Australia. Arovella is currently in the process of implementing a more elegant and user-friendly child-resistant lock and will receive a milestone payment of $40,000 in addition to a 10% royalty on the enhanced product. STADA Australia also has the option to expand its footprint by commercializing the product in New Zealand. Additionally, the company also received approval for Zolpimist® by the Chile Ministry of Health, allowing Teva (Arovella’s licensing and distribution partner in Chile, Mexico, and Brazil) to progress towards commercialization in Chile. In another development within the OroMist platform, Strides Pharma Global Pte Ltd, the development, licensing, and distribution partner for ALA-001 (Sumatriptan), had indicated its intention to cease the previously signed agreement for ALA-001. Arovella was granted a patent for Anagrelide (cancer treatment under development within the OroMist platform) with an expiry of December 2035. The company is likely to out-license Anagrelide’s intellectual property given that the primary focus of the company currently remains its cell therapy pipeline. Post its in-licensing of the iNKT cell therapy platform in June 2021, the company in-licensed the rights to a novel monoclonal antibody that targets the DKK-1 peptide from MD Anderson Cancer Center. The two licensed CAR immunotherapies aim to target highly expressed CD1d, CD19, and DKK1 antigens. The company’s lead cell therapy CAR-iNKT, off-the-shelf immunotherapy, had shown strong pre-clinical trial results against CD19-expressing cancers. The company entered into a commercial agreement with Q-Gen Cell Therapeutics (Q-Gen), the cell therapy manufacturing arm of the QIMR Berghofer Medical Research Institute (QIMR Berghofer), to manufacture ALA-101 (CAR-iNKT) for clinical trials.
- Q4 and 2022 Cash Flow Update - The company ended the quarter and the year with an operating cash burn of A$2.04 million and A$6.82 million, respectively. The operating cash burn included the A$549 thousand final payment to HC Berlin Pharma (HCBP) under the negotiated settlement in 2018. The cash and cash equivalents at the end of fourth quarter were reported at A$6.07 million.
- Valuation - We have updated our financial model incorporating the updated discount rate, cash balance, changes in shares outstanding, and comparable company analysis. Additionally, we have updated our sales and margin estimates for Zolpimist for Australia and its expected launch in Chile, Mexico, and Brazil. Our updated valuation methodology yielded a per-share value of A$0.08 per share contingent on successful execution by the company.
About Arovella Therapeutics Limited
Arovella Therapeutics is a Biotechnology company that reformulates existing drugs for oro-mucosal administration and has recently licensed novel cancer immunotherapies in early development phase. The company is targeting certain disease areas and developing therapies that help people to live longer and healthier lives.
For more information, visit https://www.arovella.com/
About Diamond Equity Research
Diamond Equity Research is a leading equity research and corporate access firm focused on small capitalization companies. Diamond Equity Research is an approved sell-side provider on major institutional investor platforms including Factset, Morningstar, and Thomson One.
For more information, visit https://www.diamondequityresearch.com.
Disclosures:
Diamond Equity Research LLC is being compensated by Arovella Therapeutics Limited for producing research materials regarding Arovella Therapeutics Limited, and its securities, which is meant to subsidize the high cost of creating the report and monitoring the security, however, the views in the report reflect that of Diamond Equity Research. As of 08/05/2022 the issuer had paid us $33,000 for our company sponsored research services, which commenced 11/11/2021 and is billed annually. Diamond Equity Research LLC may be compensated for non-research related services, including presenting at Diamond Equity Research investment conferences, press releases and other additional services. The non-research related service cost is dependent on the company, but usually do not exceed $5,000. The issuer has paid us for non-research related services as of 08/05/22 consisting of $2,500 for presenting at an investment conference. Issuers are not required to engage us for these additional services. Additional fees may have accrued since then. Although Diamond Equity Research company sponsored reports are based on publicly available information and although no investment recommendations are made within our company sponsored research reports, given the small capitalization nature of the companies we cover we have adopted an internal trading procedure around the public companies by whom we are engaged, with investors able to find such policy on our website public disclosures page. This report and press release do not consider individual circumstances and does not take into consideration individual investor preferences. Statements within this report may constitute forward-looking statements, these statements involve many risk factors and general uncertainties around the business, industry, and macroeconomic environment. Investors need to be aware of the high degree of risk in small capitalization equities including the complete loss of their investment. Investors can find various risk factors in the initiation report and in the respective financial filings for Arovella Therapeutics Limited.
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