Soligenix (NASDAQ: SNGX) stock got a boost on Tuesday after Zacks Small Cap Research published a positive note on the company that highlighted the firm’s optimism for SNGX to deliver at least two near-term catalysts, with the first coming as early as the third quarter of this year. In particular, SNGX is expected to provide interim analysis of its Phase III clinical trial of SGX942 targeting the treatment for oral mucositis in September, followed up by the topline results from that same study in the first half of 2020. Further, topline results from SNGX’s, SGX301 Phase III trial targeting cutaneous T cell lymphoma, is expected to get published in the first quarter of 2020. Upon final approval, the combined market opportunity can exceed more than a half-billion dollars.
According to the analyst’s report, these near-term and potential catalysts can serve as significant value drivers for Soligenix, with their model generating a 12-month price target of $8.00 per share. Such a move would equate to a roughly 900% increase from current stock price levels. Over the last two weeks, the stock is up by more than 18%.
Two Trials That Can Create Immense Value
As noted above, SNGX is in the final stages of two Phase III clinical studies. Seizing upon the value opportunity, a Zacks analyst published a report highlighting the potential of the SNGX pipeline and affirming an $8.00 price target in the next 12-months based on the company reporting additional positive data from the SGX942 and SGX301 Phase III trials. That report and price target was updated in July of 2019.
The SGX942 trial is enrolling approximately 190 patients to take part in a randomized, multinational, double-blind, placebo-controlled study to evaluate the drug for the treatment of severe oral mucositis in patients with squamous cell carcinoma of the oral cavity that are undergoing chemo-radiation therapy. The trial is partially funded by an NIH and SBIR grant of $1.5 million. In addition to the funding, SGX942 was selected for the Commercialization Transition Track, which is a program designed to create product awareness and additional funding to get the products to market. The SGX942 program is targeting an unmet medical need in treating oral mucositis and has already generated encouraging data in its Phase II clinical trial. Soligenix is expected to provide its Phase III SGX942 trial interim data in September of this year.
Soligenix’s second trial nearing the finish line is the SGX301 (FLASH trial), which is evaluating the efficacy of the drug in patients with cutaneous T cell lymphoma. Results to date are encouraging, and the data published in October of 2018 led to an endorsement from the independent Data Monitoring Committee to allow SNGX to enroll an additional 40 patients into the trial design to maintain 90% statistical power when reaching the primary endpoint.
SGX301 is unique in its approach to treatment and utilizes synthetic hypericin as its active ingredient combined with a photodynamic therapy that is activated by safe, visible light. The mechanism of action includes a topically applied dose of synthetic hypericin to lesions on the skin, where results show a much higher uptake by malignant cells in comparison to healthy, normal cells. After the topical dosing, and between 16-24 hours later, the treated area is then exposed to visible fluorescent light, where clinical studies have confirmed that the exposure to light results in the production of singlet oxygen. SNGX is trying to prove in its final data that the reaction caused from the combined treatment of hypericin and fluorescent light will stimulate the initiation of apoptosis (cell death), which can contribute to a balancing of cells in the human body that fortifies a healthy immune system.
More Data From SNGX Bio-Defense Program Expected
In addition to the upcoming Phase III trial results for the drugs mentioned, SNGX is advancing its biodefense products that are getting considerable financial support through non-dilutive government grants and contracts. Two additional programs that investors should keep an eye on are the ThermoVax® and RiVax® trials.
ThermoVax® is a proprietary stabilizing platform technology that protects certain vaccines from the need of cold-storage and can protect both potency and efficacy in temperatures above 100 degrees Fahrenheit. To date, ThermoVax® has demonstrated its ability to preserve the potency of vaccine candidates to treat anthrax, HPV, and Ebola for up to twelve weeks at the same high temperatures.
The second program is evaluating RiVax®, which is being developed to protect against exposure to ricin, a lethal toxin used in chemical warfare. Results from a Phase Ia study demonstrated that its vaccine antigen, an abbreviated version of the ricin toxin A chain with no biological activity, is both nontoxic and can induce an immunogenic response. According to recent updates, SNGX is expected to seek expedited FDA approval for the vaccine under the “animal rule” that relies on studies successfully conducted in non-primates.
SNGX Heading Into September
Indeed, the next three quarters can be transformational to Soligenix. Analysts have suggested that approval of both SGX942 and SGX301 can deliver more than $550 million in peak revenues to the company. And, with the biodefense program attracting additional non-dilutive funding coupled with its encouraging results to date, the Zacks price target of $8.00 makes sense.
Not only are the clinical trials showing tremendous promise, but SNGX is also well-positioned to extend its growth by benefiting from its government grants, its potential cash from warrants, and its current cash position of $7 million as of its latest filing. Perhaps the best justification for the level of optimism for SNGX, though, is that the company is actively engaged in at least five programs, all in mid to late-stage progress, targeting markets that can each generate hundreds of millions in potential peak revenues. And, at roughly $0.88 per share, the stock appears to be missing an enormous amount of blue-sky premium. Clearly, SNGX is a stock to have on your radar.
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