BioCryst Pharmaceuticals (BCRX) has become one of our more thoroughly researched biopharma companies of 2020. Initially, galidesivir caught our attention with its potential for treating COVID-19.
Our most recent research into BCRX’s pipeline reveals why we believe CEO Jon Stonehouse’s statement that 2020 will be transformative for the company rings true. As the first oral preventative treatment, Orladeyo (berotralstat) has a competitive edge over its injectable competitors. The reality of this competitive advantage is evident by the hiring of veteran rare disease specialists from big pharma competitors Takeda and CSL Behring to sell berotralstat.
Moreover, the hiring of in-house medical experts (Nephrologist and Hematologist) supports the potential of BCX9930 (oral Factor D inhibitor) to disrupt the PNH market as well as other rare diseases linked to hyper-activity of the complement system. Additionally, BCRX secured Fast Track and orphan drug designation from the FDA.
In the past week, there have been several new developments that further reinforce our bull thesis. On 8/31/20 BCRX announced that it was awarded a new $44M contract by NIAID to fund the development of galidesivir plus an additional $3M on top of its existing $40M contract for a total of ~$90M. Then on 9/3, the government executed its option to purchase an additional $7M of Rapivab (BCRX’s influenza therapeutic). Most recently, on 9/8/20 new research out of the University of Florida emerged stating that galidesivir showed great promise in-vitro against COVID-19 (even better than favipiravir). Per comments made by IR today, we know that testing in animal models is underway and that an update will be provided by BCRX once the data has been analyzed.
Despite all this positive news the stock price has been continually suppressed and declined ~10% in the last 2-weeks. With a plethora of catalysts on the horizon in the near and intermediate-term, we feel it’s only a matter of time before price action aligns with the underlying value and potential BCRX holds.
Lets recap. So what’s new?
Since our last piece going in-depth in regards to Berotralstat (please click here to read), the company and outside sources have begun reaffirming our bull case with several updates;
- HAEJ.org tweeted saying Orladeyo (Berotralstat) WILL be approved this year
- The government awarded another $3m to bcrx’s existing contract and additionally awarded a $44m contract to continue research or galidesivir for COVID-19, a key point we found being “to study non hospitalized patients.” We believe this may suggest the efficacy we believed the data supported back in March and further hints at the possibility of this being a more comprehensive solution than what’s currently available to patients
- The FDA grants orphan drug designation and fast track to BCRX’s Factor D (BCX9930)
- Insider Anthony Doyle spent half is annual salary buying BCRX shares at about $4.08, acquiring 54,000 shares
- Recent government contact activity through Eurofins Panlabs Inc. You can keep up to date with this activity here
What’s happened outside of BCRX?
Since our coverage, a lot of research has begun to surface which reaffirms our bullish standing on this pipeline and the company’s future. These things include but are not limited to the following;
- A recent study out of the UFHealth by Ahsley Brown Ph.D. is showing promise for galisdesivir and even mentioned it in front of Remidesivir. The article goes on to explain how ultimately a solution would be a drug which could be administered intravenously for hospitalized patients and given orally to non hospitalized patients
While the stock price has underwhelmed in the recent months, confirmation on our bull thesis continues to become stronger as the government continues to support galidesivir and the rest of BCRX’s pipeline continues to show promise and reason to believe that Doyle’s recent share purchase at $4.08 (42 cents under the relatively recent offering at $4.50) is a significant discount on the price towards year-end.
Things we are looking forward to before the end of this quarter and year;
- BCRX set to present at H.C. Wainwright Global Investment Conference on September 14th
- Upcoming presentation at JSA in Japan for Berotralstat starting September 17th
- BCX9930 high dose data expected by end of Q3, 2020
- galidesivir part 1 data sometime in the next 2-6 weeks
- Expansion of the galidesivir program to non-hospitalized COVID-19 patients
- Potential partnerships for galidesivir and or BCX9930
I am/we are long BCRX. Myself nor MS Money Moves or its affiliates were compensated to write this article.