When an IRP-rich business possesses so much cutting-edge technology it’s sometimes difficult for investors to keep track of all the moving parts - and that's particularly true when it comes to groundbreaking therapeutic and diagnostic science.
Avacta (AVCT ) is no exception. It followed up yesterday’s encouraging safety data for its potentially revolutionary new AVA6000 chemo-warhead pro-drug by announcing today that partner LG Chem - the life sciences division of the South Korean LG Group - had renewed its global license to commercialise Affirmer based PD-L1 inhibitors across a range of applications, including its XT technology to regulate the time a drug resides in the blood.
That's triggered a $2m payment to Avacta, and implies that its patented technology is delivering on its promise.
As a show of confidence - and I suspect at their own cost - LG Chem now plans to undertake further pre-clinical trials on a specific Affirmer based PD-L1/XT candidate, which hopefully will form the basis of an Investigational New Drug (IND) submission.
That could offer material upside to Avacta, bringing exposure to another enormous total addressable market. The PD-1/PD-L1 Inhibitors market is estimated to be worth more than $28bn worldwide annually and is forecast to grow at 19% a year (see chart) to reach a potential $1.12 trillion by 2028.
This category of drugs are used to help the body fight cancer, by enabling a patient’s T-cells to better identify and attack a tumour. In addition, the XT serum half-life extension functionally enables immunotherapies to remain active for a specified period, balancing the therapeutic benefits and required hospital resources against possible adverse side effects.
CEO Alastair Smith commented: “I am very pleased with the progress being made by our partners LG Chem with the Affimer PD-L1 checkpoint inhibitor programme, which includes the Affimer XT serum half-life extension technology. The initiation of IND enabling studies represents a significant step towards first-in-human clinical trials of the Affimer platform, which is a key value driver for the technology and for Avacta."
