Moleculin Biotech, Inc.

MBRX Details

Moleculin Biotech, Inc. (NASDAQ: MBRX) is a clinical pharmaceutical company that develops therapies for treating highly resistant cancer cells and viruses. MBRX's core technologies are 1) Annamycin, for treating relapsed or refractory Acute Myeloid Leukemia (AML), 2) WP1066, used to treat ependymoma, and 3) WP1122 for the treatment of COVID-19. As of November 01, 2021, the company’s market capitalization stood at USD 75.38 million.

Latest News:

• Progressing Towards The Treatment of COVID-19: On October 19, 2021, MBRX received authorization from the Medicines and Healthcare Products Regulatory Agency (MHRA) to initiate Phase 1a clinical trial of WP1122, its lead metabolism/glycosylation inhibitor for the treatment of COVID-19 in the UK. According to previously published preclinical results demonstrating its antiviral capabilities, MBRX believes that WP112 might address not only COVID-19 and its variations but also future viruses.

• Clinical Trial of Annamycin: On October 18, 2021, MBRX announced intermediate findings from its Phase 1b/2 clinical trial of Annamycin, assessing its effectiveness in treating soft tissue sarcoma (STS) lung metastases in the US. The US Food & Drug Administration (FDA) has given Orphan Drug Designation and Fast Track Status to Annamycin to treat STS lung metastases.

H1FY21 Results:

• No Visibility into Topline: The company has not generated any revenues to date.
• R&D Expenses: In H1FY21 (ended June 30, 2021), MBRX's Research & Development (R&D) expenses increased 9.33% YoY to USD 7.15 million from USD 6.54 million H1FY20.
• Reduction in Net Losses: Its net loss for H1FY21 was USD 8.69 million vs. USD 11.32 million reported in H1FY20.
• Strong Balance Sheet: As of June 30, 2021, the company had cash and cash equivalents of USD 79.51 million and no outstanding debt.

Risks:

• Dependence on Third-Parties: Third parties provide most of the active pharmaceutical ingredients (APIs) used in MBRX's product prospects. As a result, any delay in receiving the requisite quantity or quality could interrupt operations and negatively impact the company's overall performance.
• Product Concentration Risk: MBRX's prospects are dependent solely on the commercial success of Annamycin, WP1066, and WP1122. It has invested a considerable amount of resources in their development, and if it fails to obtain the marketing approval or put an efficient manufacturing and distribution mechanism in place, its results of operations would be adversely impacted.

Outlook:

• Clinical Trial for Annamycin: As of Q2FY21, MBRX plans to publish cohort topline findings from the current Phase 1/2 trial for the treatment of AML and report the study's topline results in H2FY21.
• European Milestones: It also expects to commence the Phase 1/2 research in Europe to assess the combined therapy of Annamycin + AraC for the treatment of AML and the second Phase 1b/2 (also in Europe) Annamycin in sarcoma lung metastases during H2FY21.

MBRX Daily Technical Chart (Source: REFINITIV)

Stock Recommendation:

MBRX's stock price has declined 44.04% in the past nine months and is currently leaning towards the lower end of its 52-week range of USD 2.49 to USD 8.78. The stock is currently trading below its 50 and 200 DMA levels, and its RSI Index is at 39.44.

Considering the correction in the stock price, encouraging results from clinical trials, and associated risks, we recommend a "Speculative Buy" rating on the stock at the closing price of USD 2.63, down 0.38% as of November 01, 2021.

* The reference data in this report has been partly sourced from REFINITIV.

* All forecasted figures and industry information have been taken from REFINITIV.

*Depending upon the risk tolerance, investors may consider unwinding their positions in a respective stock once the estimated target price is reached.  

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