Moleculin Biotech, Inc.

MBRX Details

Moleculin Biotech, Inc. (NASDAQ: MBRX) is a clinical-stage pharmaceutical company engaged in the development of therapies for treatment of 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.

Latest News:

• Step Towards Regulatory Approval: On December 01, 2021, the US Food and Drug Administration (FDA) has allowed MBRX's Investigational New Drug (IND) application to examine WP1122 for the treatment of Glioblastoma Multiforme (GBM). MBRX plans to start a Phase 1 open-label, single-arm, dose-escalation investigation assessing the safety, pharmacokinetics, and efficacy of oral WP1122 in adult patients with GBM since this approval.

• Moving Towards Treatment of COVID-19: On October 19, 2021, MBRX received approval from the Medicines and Healthcare Products Regulatory Agency (MHRA) to commence a Phase 1a clinical trial of WP1122, its lead metabolism/glycosylation inhibitor, in the UK for the treatment of COVID-19. MBRX believes that WP112 could address not only COVID-19 and its variants but potentially future viruses, based on previously published preclinical studies demonstrating its antiviral capabilities.

Q3FY21 Results:

• No Visibility into Topline: The company has not generated any revenues to date.
• R&D Expenses: In Q3FY21 (ended September 30, 2021), MBRX's Research & Development (R&D) expenses decreased 7.67% YoY to USD 4.10 million from USD 4.44 million in Q3FY20.
• Surge in Net Loss: In Q3FY21, the net loss climbed 28.98% YoY to USD 4.38 million, up from USD 3.40 million in Q3FY20.
• Cash and Debt Position: As of September 30, 2021, the company had cash & cash equivalents of USD 75.18 million and no outstanding debt.

Key Risks:

• Product Concentration Risk: MBRX's prospects are solely dependent on the commercial success of Annamycin, WP1066, and WP1122. It has invested a significant amount of resources in its development. Hence if it fails to obtain the marketing approval or put an efficient manufacturing and distribution mechanism in place, it could harm its financials.

Outlook:

• Upcoming Milestones H2FY21: In H2FY21, MBRX expect to begin a Phase 1a study of WP1122 for the treatment of COVID-19 and submit an IND for the treatment of certain tumors using WP1122, such as GBM and pancreatic cancer.
• FY22 Target: Preclinical study on antiviral indications such as HIV, Zika, and Dengue is ongoing. Collaborations are expected to begin in FY22.

MBRX Daily Technical Chart (Source: REFINITIV)

Stock Recommendation:

MBRX's share price has declined 58.80% in the past twelve months and is currently leaning towards the lower-band of the 52-week range of USD 1.98 to USD 8.78. The stock is currently trading below its 50 and 200 DMA levels, and its RSI Index is at 34.49.

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 current price of USD 2.08, down 5.02% as of December 02, 2021, 03:59 PM ET.

* 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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