It is easier to fight for one’s principles than to live up to them.”
– Alfred Adler
It is hard to believe the close of 2018 is almost upon us. It has been an eventful year, to say the least. As we close out a challenging fourth quarter for investors, we end our year looking at a small developmental firm.
Company Overview
Marker Therapeutics (MRKR) is a Houston, Texas-based clinical-stage immuno-oncology company that was founded in 1992 but did not come public until nearly 20 years later. The company specializes in developing next-generation T cell-based immunotherapies for the treatment of hematological malignancies and solid tumor indications. Marker Therapeutics has an approximate market cap of just over $200 million and trades for just under $5.00 a share. Shareholders have not been rewarded up until this point in the company’s public existence.
Technology and Pipeline
The company’s cell therapy technology is based on the selective expansion of non-engineered, tumor-specific T cells that recognize tumor associated antigens and kill tumor cells expressing those targets. Marker doesn’t genetically engineer its T cells, which, when compared to other engineered approaches, offers the following advantages: they are significantly less expensive, easier to manufacture, and seem to be significantly less toxic. The company’s pipeline includes multiTAA T cell therapy, TPIV200, and TPIV100/110.
In recent news, on October 17th, Marker announced the successful closing of its merger with TapImmune. Per the arrangement, TapImmune changed its name to Marker Therapeutics and reincorporated from Nevada into Delaware. The merger combines Marker’s T cell therapies and knowledge with TapImmune’s financial support, public stature, management, and scientific expertise. Concurrent with the merger, the company completed its $70 million offering. Also, on October 10th, it was announced that TapImmune, via the Mayo Clinic, has received an $11 million grant from the U.S. Department of Defense. The grant will cover the costs of a large Phase 2 study of TapImmune’s HER2/neu-targeted breast cancer vaccine, TPIV110, in combination with another immunotherapeutic, trastuzumab, for treating women with HER2/neu-positive breast cancer. Yet again, the U.S. Department of Defense has chosen to support the company’s therapeutic platform.
Source: Company Presentation
Source: Company Presentation
MultiTAA
MultiTAA is a diverse mix of helper (CD4) and cytotoxic (CD8) T cells that recognize the tumor-specific antigens that Marker targets. The company’s unique manufacturing process selectively expands a range of naturally occurring, often extremely rare, tumor-specific T cells present in patients’ blood that can recognize unique epitopes of up to five different tumor-associated antigens. Early results suggest that the therapy is effective, durable, and expands and activates a patient’s T cells without genetic modification or the need for lymphodepletion prior to infusion.
Source: Company Presentation
The therapy is currently being evaluated in 6 ongoing trials, which are all in the recruiting phase. The trials are testing the therapeutic approach in acute myeloid leukemia, myelodysplastic syndrome, Hodgkin or non-Hodgkin lymphomas, multiple myeloma, refractory breast cancer, pancreatic cancer and acute lymphoblastic leukemia after an allogeneic hematopoietic stem cell transplant. Marker is planning to initiate multiple Phase 2 clinical trials in relapsed/refractory acute myelogenous leukemia, non-Hodgkin’s lymphoma and multiple myeloma in 2019.
Source: Company Presentation
TPIV200
TPIV200 is a vaccine comprised of five peptide antigens, which trigger an immune response. It is derived from folate receptor alpha, which is found in high levels on tumor cells. The therapeutic is being tested in triple-negative breast cancer and ovarian cancer. The drug has been granted orphan drug and fast track designation for treatment of ovarian cancer. TPIV200 is currently being evaluated in four Phase 2 trials, two of which are recruiting and the other two are active but not recruiting.
Source: Company Presentation
TPIV100/110
TPIV100/110 is a vaccine that consist of 4 peptide epitopes derived from the HER2 protein. To enhance immunity, the peptides are admixed with the adjuvant GM-CSF. The Mayo Clinic is expected to initiate a Phase 1b/2a study of TPIV100 in women with an early form of breast cancer called ductal carcinoma in situ.
Source: Company Presentation
Analyst Commentary and Balance Sheet
Research and development expenses for the third quarter of 2018 were $1.8 million, compared to $1.6 million for the same period last year. General and administrative expenses for the third quarter of 2018 were $2.5 million, compared to $2.5 million for the same period last year. Overall, the company lost $4.3 million in the quarter, which is roughly $400,000 more than the same period in 2017.
Marker has little coverage on Wall Street. One of the latest recommendations comes from Nomura on November 16th. The firm initiated coverage with a Buy rating and set a price target of $16 a share. The analyst stated that Marker is trading at a discount to its peers and a flow of de-risking data should catapult shares higher. Also, he sees the multiTAA platform capable of rapid approval. On October 22nd, Piper Jaffray initiated coverage with a Neutral rating. The analyst appears intrigued by the company’s multiTAA platform: “it offers several key advantages over current autologous CAR-T including improved manufacturing time and expense, and potentially safer, more durable response“. Piper Jaffray reiterated their Buy rating and $10 price target on MRKR on December 3rd.
Verdict
Marker certainly has plenty of “shots on goal”. However, its entire pipeline is early and mid-stage. In addition, the company has little visibility at the moment. Adding in its disappointing record so far as a public concern, the only call is pass on making any sort of buy recommendation even as a “watch item” holding. Perhaps if the company advances some of its pipeline to late-stage development, we will revisit Marker in the future.
First they ignore you. Then they ridicule you. And then they attack you and want to burn you. And then they build monuments to you.”
– Nicholas Klein
Bret Jensen is the Founder of and author of articles on The Biotech Forum, The Busted IPO Forum, and The Insiders Forum.
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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