Genprex (GNPX) Stock: May Offer Significant Growth Opportunity

This Research Originally Appeared on CNA Finance

CORAL SPRINGS, FL / ACCESSWIRE / April 10, 2018 / Genprex, Inc. closed its IPO on April 3, 2018, selling 1.28 million shares of common stock at a price of $5.00 per share, and trades under the symbol “GNPX” (NASDAQ: GNPX). The underwriter has a 45 day option to purchase up to a total of 192,000 additional shares.

For retail investors, the opportunity to find value in GNPX may be significant, relying on the strength of an impressive management team, a defined clinical pipeline, a novel technology platform, and from its exclusive worldwide license agreements with a major cancer research center located in Houston, Texas, to deliver consistent growth. The most likely and near-term opportunity is already emerging through Oncoprex™, the company’s lead clinical drug candidate targeting non-small cell lung cancer (NSCLC), a disease that affects more than 1.8 million new patients per year and kills more than 1.6 million people per year worldwide.

From an investment perspective, the value derived from both Oncoprex™ and the company’s innovative nanovesicle technology platform may bring significant growth opportunity to small-cap investors. And, the clinical results published thus far provide a logical reason to believe that Oncoprex™ can ultimately position GNPX as a valuable therapeutic provider to the global lung-cancer market, estimated to reach $26.8 billion by 2025.

The Genprex Value Opportunity

Genprex is an active clinical-stage gene therapy company that is developing a new approach to treating cancer, based primarily on its novel and proprietary nanovesicle platform designed to intravenously administer cancer-fighting genes to tumor cells, whereby they express proteins that are either missing or below normal levels. In the Company’s lead product candidate, Oncoprex™, the tumor fighting agent, TUSC2, previously known as FUS1 is encapsulated into nanoscale hollow spheres, called nanovesicles. The TUSC2 carrying nanovesicles are injected systemically every 21 days. Oncoprex™ has a multimodal mechanism of action that plays a distinctive and vital role to interrupt cell signaling pathways that cause proliferation and replication of cancer cells, re-establishes pathways for apoptosis, or programmed cell death in cancer cells, and regulates the patient’s natural ability to provide a robust immune response against cancer cells.

To generate these potential advances in killing cancer cells, Genprex is taking advantage of its exclusive worldwide license from a major academic research center located in Houston, Texas, for patents covering the therapeutic use of particular genes that have been shown in clinical and preclinical research to have cancer-fighting properties with minimal safety or adverse event risk relative to other lung cancer drugs. Presently, Genprex’s investigators are conducting the Phase II portion of a Phase I/II clinical trial of Oncoprex™, targeting non-small cell lung cancer. According to the World Health Organization, lung cancer is the leading cause of cancer death worldwide, with the disease killing more people than breast, colon, kidney, liver, prostate and skin cancers combined. NSCLC represents approximately 80% of all lung cancers.

Specific to gauging success in the clinical trials for Genprex and Oncoprex™, respectively, the collaboration with a major cancer center in Houston, Texas, is demonstrating the potential to deliver cancer fighting genes, alone or in combination with other therapies, to combat NSCLC, a disease where the five year survival rate of Stage IV patients is about 1%. The results from the collaboration thus far, despite relying on data from a small study population, mark a significant step forward in bringing to market a cancer therapy that potentially can target and kill hard to treat cancers. And, that critical step forward may lead to delivery of needed relief to victims of lung cancer, a disease that in which overall survival has not improved appreciably in the past 25 years. Importantly, as a result of early clinical success, Genprex may be in a position to leverage the Oncoprex™ data and seek fast track, breakthrough therapy, or regenerative medicine advance therapy (RMAT) designation from the FDA to treat existing unmet medical needs, providing substantial catalyst opportunity to investors and a new therapeutic alternative to patients.

And, that opportunity may come with significant clinical expansion opportunities. In future clinical trials, Oncoprex™ may potentially be combined with other investigational or marketed drugs, and GNPX’s platform delivery technologies may be used to deliver other cancer-fighting genes, bringing additional benefit and therapeutic value to patients with lung cancer as well as other forms of cancer.

Can Genprex Deliver On An Unmet Cancer-Fighting Need?

In simplest terms, genetic mutations in cells are a primary cause of cancer. These mutations typically present in two classes, oncogenes, which are involved in functions such as signal transcription and transduction, and tumor suppressor genes, which play a role in governing cell proliferation. Genprex researchers believe that mutations may overwhelm natural tumor suppression processes, or those tumor suppression processes may be impaired or even absent. These functional alterations in either oncogenes or tumor suppression genes may result in uncontrolled and abnormal growth of cells characteristic for developing cancer.

Particular to GNPX’s clinical studies, the most common genetic alterations present in NSCLC are in tumor suppressor genes, against which few targeted small molecule drugs have been developed. This is where Genprex is focusing their attention. Genprex researchers are finding that Oncoprex™ may have the ability to interrupt cell signaling pathways that cause replication and proliferation of cancer cells, re-establish pathways for apoptosis, or programmed cell death, and to stimulate natural immune responses. Beyond just using Oncoprex™ alone, though, researchers think that the drug’s benefit can be heightened by combining Oncoprex with EGFR inhibitor drugs such as Tarceva® and with immunotherapy drugs used in lung cancer, such as Opdivo® (marketed by Bristol-Myers Squibb) or Keytruda® (Merck). Based on what the company has seen in the clinic, they have reason to be optimistic. Here’s why.

Oncoprex™ Takes A Different Approach

As noted, controlling cell signaling pathways may be a critical foundation in fighting and treating cancer. Particular to that cause, Oncoprex™ immunogene therapy is designed to interrupt cell signaling pathways that cause replication and proliferation of cancer cells. Additionally, in pre-clinical research Oncoprex™ is showing the ability to target and kill cancer cells by focusing on targeted receptor pathways that can stimulate the patient’s natural immune responses against cancer.

Different than other approaches, Oncoprex™ combines features of both gene therapy and immunotherapy to up-regulate TUSC2 expression in cells and at the same time increase anti-tumor immune cell population and minimize PD-L1 receptors thereby boosting the immune response to cancer. But, to achieve these results, GNPX had to develop a platform to deliver the therapeutic payload, and this is where GNPX may be able to distinguish itself from other companies that have been unable to provide meaningful long-term survival benefit to late-stage lung cancer patients in more than a quarter-century.

The Oncoprex™ drug design consists of a TUSC2 gene encapsulated in a nanovesicle made from lipid molecules with a positive electrical charge. The importance of the positive electrical charge is that cancer cells typically have a negative charge, thus the nanovesicle is attracted to them. Oncoprex nanovesicles are designed to deliver the functioning TUSC2 gene to cancer cells while minimizing their uptake by normal tissue. Tumor biopsy studies show that the uptake of TUSC2 in tumor cells after Oncoprex treatment is from 10 to 25 times the uptake in normal cells. Thus, Oncoprex™ can distinguish the good from the bad when attacking cells and tissue, potentially making the drug less toxic and ultimately more potent in its targeted mission. Genprex believes, that, unlike other gene therapies, which either need to be delivered directly into tumors or require cells to be removed from the body, re-engineered and then re-inserted into the body, Oncoprex may be the first systemic gene therapy to be used to fight cancer in humans.

Genprex’s Research Is Building A Strong Case For Oncoprex™

Clinical data from the evaluation of 24 patients in GNPX’s Phase I/II trial, supported with preclinical data, indicates that a combination of Oncoprex™ with Genentech’s widely used anti-cancer drug Tarceva®, can be used in humans. Additional preclinical studies have combined Oncoprex™ with the TKI gefitinib, Iressa®, by AstraZeneca in animals and human NSCLC cells, and pre-clinical studies have combined Oncoprex with an anti-PD-1 antibody equivalent to the checkpoint inhibitor nivolumab (marketed as Bristol-Myers Squibb Company’s Opdivo®). Data from these clinical and pre-clinical studies indicate that combining Oncoprex with these other therapies yields results more favorable than either these therapies or Oncoprex alone, with minimal side effects relative to other lung cancer drugs, thereby potentially making Oncoprex a therapy complementary to these cancer treatments.

Importantly, GNPX researchers did not modify any marketed drug used in conjunction and administered simultaneously with Oncoprex™. The distinction may present Oncoprex™ as a drug of choice for companies looking to utilize GNPX’s innovative delivery platform in combination therapy. The list of potential and logical collaborative partners could be with companies who are advancing other lung-cancer drugs that have similar mechanisms of action such as Merck’s, Keytruda®, Bristol-Myers Squibb’s, Opdivo®, Genentech/Roche’s, Tecentriq®, and AstraZeneca’s, Imfinzi®.

Thus, while the benefits and promise of Oncoprex™ continue to develop in the clinical and pre-clinical settings, the GNPX platform technologies may also provide value opportunity and lend themselves toward partnership agreements to evaluate other cancer-fighting genes, either alone or in combination with other therapies to combat multiple types of cancer.

Genprex Advancing Phase I/II With Oncoprex™ Combination

The first portion of the Phase I/II trial was completed using Oncoprex™ in combination with erlotinib (Tarceva®) in patients with Stage IV recurrent NSCLC that is not potentially curable by radiotherapy or surgery. The study did not limit the scope to patients that received prior chemotherapy or whether they have an expressing EGFR mutation.

The dose-escalating trial established primary endpoints for evaluating safety and tolerability in combination with erlotinib and to further determine Maximum Tolerated Dose (MTD). Secondary endpoints of the Phase I portion of the trial was to assess the toxicity of the combination of the two drugs.

The Phase I portion of the Phase I/II trial, which began in 2014, established the MTD to be the highest tested dose: 0.06 mg/kg of Oncoprex™ administered every 21 days and 150 mg of erlotinib per day. The toxicities compared favorably with those of other lung cancer drugs.

Now, with a favorable safety profile established, the Phase II portion of the trial is designed to include subjects treated with the combination of Oncoprex™ and erlotinib at the MTD determined by the prior clinical data. The primary endpoints will measure the patient response rate, and secondary endpoints of stable disease, time to progression and overall survival rate will be measured as well. According to GNPX filings, the research will recognize and measure data as defined under the Response Evaluation Criteria in Solid Tumors (RECIST). Patients will get classified as having Complete Response (CR), a Partial Response (PR), and get a determined disease control rate as defined under the RECIST criteria as Complete Response (CR) + Partial Response (PR) + Stable Disease (SD) > 8weeks.

The enrollment criteria for the second part of the Phase I/II clinical trial are identical to those in the first phase. According to published data, the results are encouraging.

How Genprex Researchers Excited Cancer Patients

Although not easy, some investors can break down the scientific language and form an opinion about clinical trial results. For others, it’s best to have them explained. And, in this case, we believe that GNPX did an excellent job summarizing their most recent clinical data in its prospectus in a way which lets investors see that the company is on the right track for eventual drug approval. They reported that:

To date, of the 39 patients allowed in the protocol for the Phase II portion of the trial, ten have been enrolled, and nine are evaluable for response under the trial protocol because they have received 2 or more cycles of treatment. Interim results indicate promise, showing that four of the patients had tumor regression and a single patient had a Complete Response under the RECIST criteria. Notably, the patient with the CR had the disappearance of the primary tumor, as well as lung, liver, and lymph node metastases.

The median response duration for all patients, defined as the median time between when a response is first noted to the time when cancer progression is observed, was three months. The response rate for the nine patients evaluated to date was 11%, and the disease control rate for the nine patients was 78%.

The response rate and disease control rate to date in the Phase II portion of the Phase I/II clinical trial substantially exceeds the response rate of 7% (with no CRs), and disease control rate of 58% reported for a clinical trial of the TKI afatinib (marketed as Gilotrif® by Boehringer Ingelheim Pharmaceuticals, Inc.) in a study referred to as the LUX-Lung 1 clinical trial. A total of 585 patients were enrolled in that Phase IIB/III clinical trial, whose primary endpoint was overall survival and whose secondary endpoints were progression-free survival, RECIST response, quality of life and safety.

The LUX-Lung 1 clinical trial was a randomized, double-blinded Phase IIB/III clinical trial treating subjects with Stage IIIB or IV adenocarcinoma, a type of NSCLC. The Phase II portion of our Phase I/II trial is not blinded, and is designed to treat NSCLC subjects regardless of EGFR status. Preliminary analysis of the early data from the Phase II portion of the Phase I/II trial supports the belief that Oncoprex™ may provide medical benefit in several sub-populations of NSCLC patients for which there is an unmet medical need, and may provide pathways for accelerated approval by the US Food and Drug Administration, or FDA.

Buying Into The Genprex Pipeline And Strategy

With the IPO having been completed, considering an investment in Genprex may be wise, and after combining the considerably small share count to the relatively low offering price, the risk/reward profile may benefit the investor and serve up an opportunity to invest in a well-run company that is hitting its stride. By targeting a multi-billion dollar lung-cancer market, with the potential to advance its platform to treat additional cancers, GNPX may be an emerging and low-cost opportunity to find significant long-term value appreciation.

With Oncoprex potentially being combined with both targeted therapies and immunotherapies, GNPX is positioned to be a potential leader in the NSCLC market. The intention is for GNPX to continue its processes to develop and commercialize treatments for cancers resulting from its proprietary gene therapy platform. Genprex believes that clinical data support the pursuit of accelerated FDA approval, especially in sub-populations of NSCLC patients for whom there is no approved therapy. Additionally, GNPX intends to pursue clinical trials of Oncoprex™ with anti-PD-1 immunotherapy drugs, as well as possibly enter into clinical studies of Oncoprex™ with other targeted therapies and/or immunotherapies.

Beyond just NSCLC, GNPX has stated interest in exploring the effectiveness of combining Oncoprex™ with other agents such as erlotinib in other cancers such as soft tissue, kidney, head and neck, and breast cancer. These potential new studies may lead to new gene therapy development programs utilizing Genprex’s additional licensed proprietary genes associated with the specific and highly studied chromosome 3p21.3.

Monetizing The Value At Genprex

For investors, the length of time and path required to monetize an opportunity is often the most critical component in making an investment decision. And, some companies, like Genprex, assist in the decision-making process by guiding investors to how they intend to succeed.

At GNPX, management has laid out a strategic plan to continue developing the manufacturing capability and process necessary to commercialize Oncoprex™. To expedite the commercialization process, GNPX may turn to strategic partnerships with other drug developers and providers of anti-cancer drugs, and to the possibility of conducting combination studies with companies such as Merck (MRK), Bristol-Myers (BMY), AstraZeneca (AZN), and Genentech (DNA) being a real possibility based on previously generated analysis and study data. A relationship with any of the above might serve to expedite drug development and increase commercial opportunities for the current and future Genprex cancer-drug program.

With an active and innovative drug program already established, Genprex is worthy of investment consideration based not only on the intrinsic and potential value in Oncoprex™, but because of its novel and technically advanced platform that may lead to additional sources of revenue through licensing, partnership, and co-development opportunities. Then, factoring in that the company relies upon an extremely experienced team of medical professionals, and research conducted at a major cancer center, the opportunity gets even more appealing.

But, it’s the capital structure of the IPO that may present the most current opportunity for stock price appreciation, a speculative thesis based on the extremely small outstanding share count of only 1.28 million shares after the completed IPO (plus another 192,000 shares if the underwriter exercises its full overallotment option). Thus, with the signing of just a single new collaboration or news of an FDA-related catalyst, shares of this emerging cancer-fighting company may prove to be a very compelling value opportunity, especially for risk-tolerant investors that seek out companies that may disrupt the way an industry operates. And, by banking on the GNPX approach of using targeted nanovesicle delivery, early investors may reap the spoils of investment victory.

Disclosure About The Genprex Form S-1 Filing

Genprex has filed a registration statement on Form S-1 with the SEC for its initial public offering to which this article relates. The registration statement, as amended by a post-effective amendment, has been declared effective by the SEC. Before you invest, you should read the prospectus relating to the offering (including the risk factors described therein) and the other documents Genprex filed with the SEC for more complete information about the company and the offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov.

Alternatively, Genprex will arrange to send you the prospectus if you request it by contacting Genprex, Inc. at 100 Congress Avenue, Suite 2000, Austin, Texas 78701, attention Elizabeth Han, or by email at ehan@genprex.com.

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SOURCE: CNA Finance, LLC

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