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What happened
Actions of Agenus (NASDAQ: AGEN) rose more than 13% today after the company announced a vaccine manufacturing partnership with Phyton Biotech for QS-21, one of Agenus’ vaccine products. The partnership comes after the duo successfully concluded a proof of concept project made possible by a million dollar grant from the Bill & Melinda Gates Foundation.
The collaboration will focus on developing a new manufacturing process for QS-21, a plant extract added to various vaccines to make them more potent. The process is based on a new technology platform used by Phyton Biotech. If successful, the effort could increase the availability of the QS-21 and reduce its cost, thus creating the potential to significantly expand its market opportunity.
As of 3:11 p.m. EST Thursday, the stock had stabilized at a gain of 10%.
Image source: Getty Images.
So what
In technical terms, QS-21 is a saponin-based vaccine adjuvant. This means that it is extracted from the soap tree native to Chile. As is often the case with rare and high-value natural products, the extraction process is not very efficient. This is a problem as QS-21 is finding use in more and more vaccines, notably the Shingrix herpes zoster vaccine. GlaxoSmithKline and many others in development at the industry leader.
Enter Phyton Biotech. The company’s plant cell fermentation (PCF) technology helps grow plant cell cultures in steel bioreactors, much like brewing beer. PCF makes it possible to take advantage of high-efficiency, high-efficiency industrial biotechnology processes for the manufacture of a variety of pharmaceuticals that are difficult to produce by other means. A plant-based production process is ideal for the manufacture of the QS-21.
Although industrial plant cell cultures are not unique to Phyton Biotech, the company is a leader in the niche manufacturing process. It is currently the world’s largest producer of taxanes, a class of chemotherapy drugs, and has significant global manufacturing capacity.
Now what
That said, while the partnership is potentially great news to ensure a stable supply of QS-21, the material benefit for Agenus appears limited. In January 2018, he sold the royalty rights to the saponin-based vaccine adjuvant for a rapid injection of $ 190 million. It could earn up to $ 40.4 million in milestone payments based on this year’s and next year’s sales figures, but the PCF-based platform may not be fully ramped up. by then. The implementation of a new industrial biotechnology process can take 12 to 24 months, and it is still under development.
In other words, today’s news doesn’t really shake things up for long-term investors, even though Agenus progresses develop its pipeline elsewhere.
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Maxx Chatsko has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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