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EQS-News News vom 25.06.2019

Abivax SA (ABVX-FR): Ready to deal with inflammation

goetzpartners securities Limited

25-Jun-2019 / 15:15 GMT/BST

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Published to the market and investors on 25th June 2019 @ 7.38am (BST).

Abivax SA
Recommendation: OUTPERFORM
Target Price: EUR 31.30 (increased from EUR 28.80)
Current Price: EUR 7.95 (CoB on 24th June 2019)


Focussed on identification and exploitation of regulators of immunity and inflammation, Abivax has two major products in clinical trials. With Phase 2a efficacy on a par with recently approved tofacitinib, ABX464 shows sustained benefit in ulcerative colitis ("UC") without the safety concerns of JAK or anti-TNF drugs. Moving into confirmatory Phase 2b for UC and Phase 2a in Crohn's and rheumatoid arthritis ("RA"), ABX464 promises a meaningful share of the $70bn anti-inflammatory market and a substantial licensing agreement by 2020E. Entering Phase 1/2, ABX196 is a powerful activator of iNKT cells with potential to extend the benefits of PD-1 / PD-L1 immune checkpoint inhibitors ("ICI"). Sustained by ICIs iNKT cells act directly on cancer cells as well as promote the anti-tumour activity of key ICI-activated cells; a strong rational for synergy. Funded until Q1/2020E, we believe the ABX464 data provide a strong basis for licensing to provide development funding thereafter. We reiterate our OUTPERFORM and increase our TP to EUR31.30 (from EUR28.80).

Anti-inflammatory benefits compare well to current drugs -
With healing and clinical improvement in UC on a par with tofacitinib, six- and nine-month data from the Phase 2a extension study indicate that ABX464 clinical benefits are sustained. We are optimistic that a full assessment scheduled for 12 months will show continued healing.

Safe and well tolerated - With >200 patients treated in UC and HIV, ABX464 appears safe and well tolerated with no evidence of the infections and serious issues associated with anti-TNF or small molecule drugs like tofacitinib. The 12-month Phase 2a extension study has now been extended to 24 months based on ABX464's safety and efficacy.

Further data and partnering expected - A dose-ranging Phase 2b trial in 232 patients aims to confirm the benefits of ABX464 in UC with PoC Phase 2a trials planned in Crohn's and RA all reporting 2020E. Abivax is optimistic of securing a licensing / development partner for ABX464 by Q1/2020E.

Large unmet need in substantial market - Although anti-TNF drugs have transformed inflammatory therapy, 30% - 40% of patients fail or cease to respond. There is a need for a safe effective orally available alternative.

ABX196 promises real synergy with checkpoint inhibitors - The anti-tumour action of iNKT cells and their potential synergy with PD-1 / PD-L1 immune checkpoint inhibition is well established. A well characterised iNKT cell activator, ABX196 has potential that sets it apart from the myriad of other ICI combinations as it moves into Phase I / II trials with nivolumab.

Under-valued at current levels - Currently funded through Q1/2020E, the company aims to secure long term funding through though ABX464 partnering. We are optimistic that this will be achieved based on the strength of the UC Phase 2a data. DCF analysis indicates a current valuation of EUR31.30 rising to > EUR50 / share with PoC in Crohn's and RA.


Kind regards,

Chris Redhead | Analyst
goetzpartners Healthcare Research Team | Research Team

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