Opthea's (OPT: $0.91) share price is up 160% since the end of June. The company has been in a transition phase this year with a new, US based management team put in place, and a final capital raise before the release of the Phase III trial results with its lead drug candidate, sozinibercept, for the treatment of wet AMD.
In July, Opthea completed a $227 million (US$150 million) capital raising at $0.40 per share. The company held cash of US$172 million at the end of June. This gives the company at least two years of cash, placing it in a strong position to secure one or more licensing deals for sozinibercept. Of interest is whether a regional deal, such as for Europe, can be secured before the readout from the Phase III studies.
The first of those studies (topline data) is due to read out in the June quarter next year, and topline results from the second study are due shortly after (mid 2025).
Vanguard Group Joins Share Register
Last month The Vanguard Group, which has US$9.3 trillion in funds under management, acquired a 5% stake in Opthea, helping drive the Opthea share price along.
Under New Management
In October last year the company appointed a new US-based management team, with Frederic Guerard as CEO. He was previously Worldwide Business Franchise Head for Ophthalmology at Novartis. This week the company has made other changes, with Tom Reilly appointed CFO (formerly CFO at Amarin Corporation), Dr Parisa Zamiri as CMO (previously VP, Global Head of Clinical Development and Therapeutic Area Head for Ophthalmology at Novartis). It has also appointed Anand Sundaram as VP of Marketing (starting next week). Sundaram was the second hire in the launch of another AMD drug, Beovu from Novartis, and led the launch of Lucentis' pre-filled syringes for wet AMD treatment.
Manufacturing Batches Produced for Product Launch
Opthea has manufactured three consecutive commercial-scale batches of sozinibercept that will support its marketing approval (BLA), pending positive Phase III trial readouts and positions the company to provide drug product for commercial launch.
Other Programs
Opthea is ready to commence a Phase III study with sozinibercept in Diabetic Macular Edema, which is likely to proceed commercial progress (BLA receipt, commercial deal, product launch) in wet AMD.
It is also conducting a feasibility study with a co-formulation of sozinibercept with a VEGF-A drug, with either one of the branded products (Lucentis or Eylea) or with a generic equivalent to the branded drugs. That sozinibercept needs to be given as a second injection (after treatment with a VEGF-A inhibitor) will hinder adoption to a degree.
Summary
It has been a long wait for Opthea shareholders since 2019's Phase IIb trial readout, but the path to market is appearing more tangible.
The company states that it is not in competition with the existing VEGF-A drugs but will be used in combination to improve outcomes. Sozinibercept targets VEGF-C and VEGF-D, providing a more complete shutdown of the angiogenesis pathway that creates unwanted blood vessels in the eye.
One commercialisation option for Opthea in the US would be to sell direct with a 'lean and targeted' sales force, given the concentrated prescriptions in the US according to the company.
Opthea is capitalised at $1.1 billion.
Bioshares recommendation: Speculative Buy Class A
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