1. health and fitness
2. disease
3. cancer

Deutsche Bank
Markets Research
Rating
Company
Buy
VBL Therapeutics
Alert
North America
Date
25 March 2015
Breaking News
United States
Health Care
Reuters
VBLT.OQ
Bloomberg
VBLT UQ
Exchange Ticker
NMS
VBLT
Biotechnology
Ph2 interim GBM data looks
encouraging to us
We do think that these data are encouraging of additive effect when used on
top of Avastin
Both cohorts were treated with VB-111 until progression and then at
progression one cohort (n=22) was treated with Avastin alone and the second
cohort (n=24) was treated with VB-111 in combination with Avastin. The
median overall survival (OS) of the combo arm was 414 days vs. 235 days
(p=.05 on a Wilcoxon test) in Avastin alone. At SNO with only 15 of the 23
combo pts reporting the difference in OS was 504 days in the combo vs. 235 in
the Avastin arm (p=.22 in a log rank scale and p=.1 in a Wilcoxon test). A
median of 4 doses were given in the combo arm versus a median of 1 dose in
the monotherapy Avastin arm. We note that the FDA has guided the company
that a survival benefit of 3 months is clinically meaningful and we think this
survival benefit in these small cohorts is encouraging.
Price at 24 Mar 2015 (USD)
Price target
10.00
52-week range
16.44 - 3.22
Alethia Young
Mohit Bansal
Research Analyst
Research Associate
(+1) 212 250-5751
(+1) 212 250-3076
alethia.young@db.com mohit.bansal@db.com
Robyn Karnauskas
Research Analyst
(+1) 212 250-7591
robyn.karnauskas@db.com
Ellie Merle
Research Associate
(+1) 212 250-2011
eliana.merle@db.com
Key changes
Phase 3 studies in rGBM are risky from our experience but looks like co
pursued a tough patient pop in Ph2. We remain at 75% POS.
The co thinks patients in Phase 2 were very similar to Phase 3 and that the trial
will be powered strongly to detect a change. There will be an interim look after
91 events in 2Q16. Timelines remain on track for the trial to start in mid 16. We
note that Avastin has had highly variable survival data in the past because of
the severity and heterogeneity in treatment of GBM. Many cancer trials fail in
Phase 3 and we caution given the small size of this Phase 2 in a highly variable
population. However, we do see these data as encouraging.
EPS (USD)
The co will show updated curves at ASCO which are important to review as
well
Management guides that this is a mostly mature curve, but from the call they
noted that there will be some things we can learn from the curve at ASCO. For
instance, they said the curves separated early which is a promising sign but
further information at ASCO will add important color into how early the benefit
of VB-111 is seen.
Option volume (und. shrs., 1M
avg.)
Our peak sales are $390M worldwide in 2025.
We assume $270M in the US and $120M in the EU. As it pertains to the EU,
understanding the Avastin paradigm in an ongoing study is key. If Avastin
becomes standard of care in the EU, we think a global trial would work. The co
expects that the Avastin study in the EU will be done by year end. Also note
that we assign 35% share to second line and 0% to first line so a point of
upside would be if share could be taken in front line therapy.
5.54
0.89 to 0.88 ↓
-1.5%
Source: Deutsche Bank
Stock & option liquidity data
Market cap (USD)
110.5
Shares outstanding (m)
19.9
Free float (%)
100
Volume (24 Mar 2015)
74,701
–
Source: Deutsche Bank
Key data
FYE 12/31
1Q EPS
2Q EPS
3Q EPS
4Q EPS
FY EPS (USD)
P/E (x)
2014A
-0.18
-0.19
-0.19
-0.17
-0.74
–
2015E
–
–
–
–
0.88
6.3
2016E
–
–
–
–
3.49
1.6
Source: Deutsche Bank
* Includes the impact of FAS123R requiring the expensing of stock
options.
________________________________________________________________________________________________________________
Deutsche Bank Securities Inc.
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DISCLOSURES
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