Hemispherx Biopharma (NYSEAMERICAN: HEB), a research and development biotechnology company, is grabbing the attention of the investing community, and for good reason. Not only does the company have revenue-generating products, but its flagship candidate, Ampligen, is showing incredible promise.
What Is Hemispherx Biopharma?
Headquartered in Ocala, Florida, Hemispherx Biopharma is a research and development immuno-pharma company. The company is focused on the development of treatments designed for patients with various forms of cancer and immune deficiency disorders.
The company’s claim to fame is its flagship product, known as Ampligen. Currently, Ampligen is approved, and pending commercial launch, in Argentina as a treatment option for myalgic encephalomyelitis/chronic fatigue syndrome, commonly referred to as ME/CFS. In fact, Ampligen is the only drug that has ever been approved for the ME/CFS indication globally.
The treatment is also under development as a potential option to address various forms of cancer. A number of animal studies and early- to intermediate-stage clinical studies of Ampligen have generated promising results suggesting its possible efficacy as a combination therapy or as a standalone option in treating a number of solid cancer tumor types.
Nonetheless, HEB is not a one-trick pony. The company’s other product, Alferon N Injection, has also achieved regulatory approval. Alferon N Injection is approved in the U.S. and Argentina for the treatment of refractory or recurring external condylomata acuminata (genital HPV) and in Argentina for patients who have become intolerant or refractory to recombinant interferon. The treatment has also been studied in preclinical development stages as a potential option for patients with Middle East Respiratory Syndrome (MERS) and the Influenza A virus.
Several Catalysts To Look Forward To
Investors can look forward to quite a bit of action in the stock over the next year, at the very least. With a robust pipeline of clinical development programs, there are several catalysts ahead.
Ampligen, while approved in Argentina, is the subject of multiple clinical trials. Here’s what we have to look forward to with regard to Ampligen:
- Phase 2 Data Readouts – Recently, HEB announced that the first patient has been treated with Ampligen in a Phase 2 ovarian cancer program taking place at the University of Pittsburgh Medical Center (UPMC). This ovarian cancer program is a follow up to a Phase 1 / 2 clinical trial in recurrent ovarian cancer where UPMC assessed intraperitoneal safety, tolerability, and efficacy of Ampligen. With the first patient treated, we can now look forward to interim and final data readouts.
- Ongoing Immuno-Oncology Clinical Trials
- Recurrent Ovarian Cancer: https://clinicaltrials.gov/ct2/show/NCT03734692
- Colorectal Cancer Metastatic to the Liver: https://clinicaltrials.gov/ct2/show/NCT03403634
- Metastatic Triple Negative Breast Cancer: https://clinicaltrials.gov/ct2/show/NCT03599453
- Recurrent Ovarian Cancer: https://clinicaltrials.gov/ct2/show/NCT02432378
- Prostate Cancer: https://clinicaltrials.gov/ct2/show/NCT03899987
- Early Access Program (EAP) in Pancreatic Cancer Data – Hemispherx Biopharma is also deriving Phase 1-type safety data as a result of an ongoing EAP using Ampligen as a potential treatment for patients with advanced pancreatic cancer. To date, treatment with Ampligen has proven to be generally well-tolerated. Moving forward, we can also expect to see data on the experience of patients in this program. The Ampligen EAP provide for the company to recover the costs of providing the drug to treated patients.
- Preclinical Activities – Ampligen has been studied in animal models of three histologically different cancers. In these studies, the addition of Ampligen to checkpoint blockade drugs was able to induce synergistic anti-tumor activity in mouse models of pancreatic cancer and melanoma. In the third model, for colorectal carcinoma, the combination of both drugs significantly increased survival compared to checkpoint blockade alone. As such, should preclinical data continue to be positive, investors can look forward to possible initiation of additional clinical trials, first patient treated announcements, and interim and final data readouts.
Alferon N Injection Catalysts
While the company’s Alferon N Injection has achieved approval for multiple indications in Argentina and as a treatment option for genital HPV in the United States, Hemispherx Biopharma isn’t stopping there with this asset.
In addition to the clinical research supporting the commercial approvals, the company has conducted preclinical research for a variety of respiratory diseases, including MERS and influenza A, with the MERS indication receiving Orphan Drug Designation in Europe.
Although the Alferon N Injection has been approved in the United States and Argentina, the original manufacturing process made it difficult to compete effectively with other treatment options. Nonetheless, Hemispherx Biopharma is working diligently to change this. In fact, HEB has developed a high-volume, high-efficiency, updated manufacturing process that is expected to facilitate production of viable commercial volume of the drug. Before initiating commercial production using this process, the company will need to submit a supplemental application and complete a successful FDA review and pre-approval inspection.
Strong Market Potential
Considering the fact that Hemispherx Biopharma has a market cap of just over $10 million, the market potential here is incredible. Moreover, HEB has a potentially big winner with Ampligen. As mentioned above, it is the only treatment option approved so far for patients with ME/CFS, having approval in Argentina. The company estimates that should it address just 10% of the global market, the drug could lead to around $500 million in annual revenue after additional regulatory approvals.
Not to mention, Ampligen is in various stages of clinical studies for multiple cancer types. As anyone who invests in biotechnology knows, an approval in a cancer indication opens the doors to potentially tremendous streams of revenue. All in all, this adds up to market potential that’s hard to ignore.
In terms of Alferon N Injection alone, the company’s facility, mentioned above, is believed to be capable of producing more than $90 million in gross annual revenue once it is fully functional.
About 20% of patients develop neutralizing antibodies to recombinant alpha interferons, so those standard of care treatment options can lose efficacy in the treated patient population over time. With the approval and coming commercialization of Alferon, this patient population will have a new treatment option.
Considering that 20% of patients on alpha interferon treatments may find Alferon N to be an alternate treatment option, demand for Alferon N may be high, leading the company to believe that it may be able to utilize the full capacity of their production facility for this drug.
A Successful Reverse Split Will Open Doors
It’s also worth mentioning that Hemispherx Biopharma recently successfully effected a reverse split of their common stock.
Ultimately, the reverse split was a strong move for two reasons. First and foremost, it brought the price of the stock over the minimum bid price requirement for the stock to maintain its listing on the NYSE. However, the larger reason for the positivity here has to do with investor perception.
Many institutional investors, family funds, and other big-money investors tend to stay away from stocks that are valued under $1. As a result of the reverse split, the stock is now trading well above the $1 mark, making it more appealing to these big-money investors.
The Bottom Line
The bottom line here is a very simple one. Hemispherx Biopharma has already proven its ability to successfully achieve new drug approvals, leading to coming commercial launches that will likely drive significant revenue growth. Moreover, with multiple clinical trials in place, there are several catalysts to look forward to. This, combined with the market potential of the company’s treatments, suggests that the stock has plenty of room for growth ahead!