An aging population, a larger amount of the healthcare spending going toward drugs and treatments (roughly 10% of overall healthcare spending) and new technologies being used to create new and more effective compounds (the FDA approved the second most drugs ever in 2015) are all key factors to stronger future growth potential for biotechnology. Let’s also not forget the rise in global viral threats like the Zika virus, which has recently come to light.
So why bring all of this up? Many biotech companies are undertaking phase trials, have projects under development, and some have just begun to start capitalizing their action plans; meaning, biotechnology is usually a longer road ahead. The allure of underfollowed companies has been a big focus as of late with the mergers and acquisitions climate becoming red hot.
With eyes everywhere, the Pfizers and Johnson & Johnsons of the world are targeting smaller companies during a time when the mergers and acquisitions climate is red hot. In fact an analyst from Zack’s Research has stated, “…Encouraging industry trends including a merger & acquisition frenzy, promising drug launches, cost-cutting efforts, an aging population, ever-increasing demand for new drugs, higher healthcare spending, expansion into emerging markets and Obamacare will continue to fuel growth in the sector.”
So where can investors look to gain ground without breaking the bank on a higher priced stock? In my opinion, small and micro-caps. But unlike many that are just “developing an idea” or “planning for pre-phase trials”, there has been one company with proven management which has begun to catch real attention for their very real therapy for cancer, among other things within their pipeline.
OXIS International, Inc. (OTCMKTS:OXIS) could be one of the most undervalued biotechnology stocks on the market today and I’ll explain why I think this. This company through its wholly owned subsidiary, Oxis Biotech, Inc. develops and commercializes innovative immunotherapeutics for the treatment of cancer. And it’s the company’s lead drug that has captivated the attention of biotech investors.
OXIS has a robust portfolio of next-generation cancer initiatives and its lead drug candidate, OXS-1550, is in Phase 1/Phase 2 clinical trials at the University of Minnesota Masonic Cancer Center as a treatment for non-Hodgkins lymphoma and leukemia.
- OXIS Holds Worldwide Exclusive Rights & U.S. Patent For Lead Therapy
Oxis International holds worldwide exclusive rights to develop and commercialize OXS-1550. Furthermore, inventors of the therapy recently received a Notice of Allowance from the United States Patent and Trademark Office. U.S. Patent No. 9,371,386 provides bi-specific targeting compositions including a cytotoxic agent conjugated to a targeting moiety and a binding fragment which targets CD19 or CD22. The patent also includes methods of treating humans having lymphoma or B-cell malignancies using the patented composition.
OXIS further has licensed exclusive rights to three Antibody-drug conjugates (ADCs) through an agreement made in early 2015 with MultiCell Immunotherapeutics, Inc. MultiCell will prepare these ADCs for further evaluation as prospective therapeutics for the treatment of triple-negative breast cancer, as well as multiple myeloma and associated osteolytic bone disease.
- OXS-1550 Demonstrates Success In Early Human Clinical Trials
What should beg immediate attention on OXIS is that OXS-1550 has demonstrated success in early human clinical trials in patients with relapsed/refractory B-cell lymphoma or leukemia. The company’s FDA-approved clinical trial is currently being conducted under the watch of Dr. Daniel Vallera, a research scientist who developed the drug and is actually a member of the Scientific Advisory Board of Oxis Biotech.
In a recent announcement, OXIS added six new patients to its Phase 1/ Phase 2 Clinical trials. This brought the total number to 32 patients currently participating in the trial.
- OXS-1550 Proven To Initiate Complete Remission In Early Trials
Unlike many other drug therapy companies, OXIS…this tiny biotech…has actually realized an occurance of complete remission during its Phase 1/Phase 2 trials. In an unprecedented instance, the company states that one of its patients who was given an approved increased dosage of OXS-1550 saw complete remission in her (Cynthia Cattell) lymphoma.
This is something that not even much larger and much more capitalized drug thereapy companies can boast in Phase 3 let alone Phase 1/ Phase 2. According to OXIS press releases, Cattell stated that all “other aggressive B-cell lymphoma treatments” had failed until she was treated with OXS-1550.
The cure for cancer? These results certainly reinforce the stance on OXIS from a drug perspective.
- Search & Destroy
What sets OXS-1550 apart from other drug therapies is the it is designed to search out cancer cells and destroy them completely. This is all while having no adverse affects on healthy cells.
“This drug is a powerful alternative to chemotherapy since many patients fail chemotherapy or reach the toxic limits of their chemotherapy. It is urgently needed in the clinic.”
-Dr. Daniel Vallera.
- Strong Pipeline Of Other Therapies
Outside of the lead candidate OXS-1550, Oxis has several other key drug candidates that address growing needs within high profile segments:
Addresses a type of cancer called Multiple myeloma, which forms in white blood cells and affects nearly 30,000 people in the US per year. About 1/3 of those affected end up dying. Due to the serious nature of this bone marrow cancer, multiple myeloma can actually cause bone lesions, and even produce abnormal proteins that can accumulate in urine. OXS-4235 was designed as a chemical compound to inhibit osteoclastic bone destruction in multiple myeloma.
Addresses triple negative breast cancer. According to the American Cancer Society there were over a quarter million new cases of invasive breast cancer in the US last year with over 40,000 deaths coming from breast cancer during that period. OXS-2175 is a small molecule therapeutic candidate that has shown “promise,” according to the company, in early stage preclinical in vitro and in vivo models of triple negative breast cancer. Due to the fact that there is no known or pending drug therapy for the treatment of Triple Negative breast Cancer, this opens another opportunity for Oxis International to capitalize on.
- Industry Opportunity
Multiple Myeloma Presenting Multi Billion Dollar Opportunity
According to FiercePharma, Celgene’s cancer drug Revlimid® for the treatment of multiple myeloma generated nearly $5 billion in revenue for the company in 2014. Analysts believe sales of Revlimid could double within 5 years as a result of FDA’s recent approval of expanded labeling concerning the use of Revlimid in combination with dexamethasone for patients newly diagnosed with multiple myeloma. About 93,600 patients are living with multiple myeloma in Europe and about 88,499 patients are living with it in the United States, Celgene said.
Limited Breast Cancer Treatments Roll Out The Carpet For New Therapies…
PDL BioPharma, Inc. stated its licensee Genentech, Inc. reported sales of Herceptin® which is used to treat HER2 breast cancer totaled $7.3 billion in 2014. Of the 280,000 patients in the USA diagnosed annually with breast cancer, about 20% are diagnosed with triple-negative breast cancer.
Treatment options for triple-negative breast cancer patients are limited because the three most common types of receptors known to fuel most breast cancer growth – estrogen, progesterone, and the HER-2/neu gene – are not present in the triple-negative breast cancer cells, hence patients are ineligible for treatment with either hormonal or HER2-targeted agents such as Herceptin. Treatment typically involves non-targeted cytotoxic chemotherapies.
- Proven Management
Obviously no company can expect to “go the distance” without a sound leadership team at the helm and OXIS has just that. As CEO, Anthony Cataldo is no stranger to emerging biotech and has been credited with taking companies “to the next level”. In fact Mr. Cataldo served as Founder and Chairman/CEO of Genesis Biopharma, Inc., now known as Lion Biotechnologies, Inc.(LBIO).
Mr. Cataldo created the highly successful Lion/Genesis (LBIO) with the inclusion of assets acquired from the National Cancer Institute for the treatment of stage four melanoma. Cataldo managed to grow LBIO’s market-cap 250x through a simple process: acquiring strong IP, having a strong research team, and attracting the right group of inside ownership to build a REAL biotechnology enterprise.
Mr. Cataldo has extensive experience in the biotechnology sector having served as Chairman/CEO of several biotech companies including: MultiCell Technologies, Inc., Calypte Biomedical Corporation, and Senetek, PLC.
At the end of the day, penny stocks of any kind can be risky and biotechnology investments as a whole can have their own risk involved. Many cannot complete phase trials simply due to lack of funding and others wind up going to Phase 3 and finding futility due to lack of recordable or efficacious results.
Oxis, on the other hand, has already proven that its lead candidate, OXS-1550 has shown real promise. How? For starters, in its current trial phases, one patient has already been in a year of remission following the approved increased dosage of OXS-1550. In addition to that the company is also in active development and preclinical trials of two therapies that address very specific and very unmet diseases. This mix of market exclusivity and future pipeline would be expected from much larger companies but Oxis only has a market cap of roughly $6.5million and trades under $0.50.
So just as I said above, where can investors look to gain ground without breaking the bank on a higher priced stock? I feel as though Oxis International has been one company with proven management, which has begun to catch real attention for their very real therapy through its lead drug OXS-1550 and will be something to watch closely.
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