Miami, FL – October 31, 2018 (EmergingGrowth.com NewsWire) — EmergingGrowth.com, a leading independent small cap media portal with an extensive history of providing unparalleled content for the Emerging Growth markets and companies, reports on Marker Therapeutics, Inc. (NASDAQ: MRKR).
- Strong institutional sponsorship with a deep bench
- Baker Brothers with legendary track record in biotech
- Technology addresses all weaknesses of traditional CAR-T Therapy
- Grossly undervalued compared to the Kite Pharma acquisition
- Nobel Laureate Jim Allison on strategic advisory board.
Marker Therapeutics (MRKR) formerly known as TapImmune announced in June of this year a 70$ million dollar financing to close the merger with Marker that included institutional investors New Enterprise Associates (NEA), Aisling Capital, and Perceptive. The most recognizable and famous name when it comes to biotech investors was finally revealed in the latest S-3 registration released yesterday. The Baker Brothers, many of which believe have the Midas Touch in the biotech world, invested $5.4 million according the S-3 Filing, and that is a story by its own merits. When taken in context with the other lead investors in MRKR the S-3 reads like a who’s who of investors. Each of these top institutional investors is a lead investor in their own right.
What make this revelation so newsworthy is that it’s rare to see a concentration of lead investors of this prestige in such a small company with a market capitalization under $500 million. Retail investors will be quick to spot the smart money investment from Baker Brothers realizing that the omission from the June press release may have been purposeful and designed to buy time for them to accumulate additional shares in the open market. The real push may come after the Baker Brothers or one of the other key investors files their quarterly 13-F. Investors will be speculating on how much each of these famous investors have accumulated since the private placement, but the backstory is how these 4 came together to invest is one of the most disruptive technologies in cancer treatment. If history is any tell, these type of investors aren’t swinging for the hundreds of millions of gains, but for the billions.
Financing Breakdown by Top Strategic Institutions
New Enterprise Associates $20.0 million
Aisling Capital $8.0 million
Perceptive Life Sciences $8.0 million
Baker Brothers Life Sciences $5.4 million
Baker Brothers Track Record
Consistency seems to be one of their best weapons in finding the right deals in the health sector. Based on their performance many of their stocks rise exponentially or just plain roll over and die. It’s their decision making to cut and run from a bad story, thereby allocating properly has served them well.
A-Typical Investment for Baker Brothers Suggests Explosive Potential
The portfolio companies primarily held by Baker brothers are in the billions not in the hundreds of millions. According to WhaleWisdom small companies the size of MRKR make up only 2.9% of their overall portfolio. Seattle Genetics (SGEN) is one of the Baker Brothers most successful long term investments and currently its top holding representing 27%of their portfolio. Long ago SGEN was a company the size of MRKR and just started growing and the Baker Brothers kept adding more and more investment. MRKR with its platform potential just like SGEN with its Antibody-Drug Conjugate (ADC) platform.
Company Rebranding In Process
In additional to being able to attract Jim Allison a recently awarded Nobel Laureate the company announced the name change from TapImmune to Marker Therapeutics, but it’s more than just a name change, but rather an evolution toward a new approach toward cancer treatment. The corporate headquarters are moving from Jacksonville to Houston to be close to Baylor Medical Center where the Marker labs are located. The company has revamped the website in the Marker image. The staff has morphed into support roles revolving around Markers technology. Jim Allison, considered the grandfather of CAR-T recently won a nobel prizefor his cancer research is on the advisory board of MRKR. This merger has been transformational in all aspects and appears to have taken the best attributes of TapImmune and Marker rolled them into a new and improved version of Marker. This new Marker wants to sell its story to the street and showcase the potential of the technological platform.
Breaking the Paradigm of CAR-T Therapy
Based on the cancer indications that Marker is targeting and the personalized therapies offered, the company had been categorized as a CAR-T company. The thing is the company is nothing like a CAR-T company because it represents the next evolution of personalized medicine without the costs and side effects of traditional CAR-T therapy. This means no Cytokine Release Syndrome (CRS), no lymphodepletion, and no plasmapheresis. The bottom line seems to be a durable response as evidenced by the comparison of the Kite versus Marker trial results in Acute Myeloid Leukemia (AML). The company also has a highly efficient if not completely disruptive approach toward cultivating cells using the GREX platform which estimates the cost per patient at $8,000 in contrast to Kite Pharmas cost of $100,000 per patient. MRKR essentially has the holy grail of blood borne cancer treatment because they can collect a sample with a small blood draw, quickly and safely expand the culture of cells, inject using an intra articular injection, and leave the patient with a durable and lasting response. The strength of Markers Multi TAA approach addresses each an every weakness of traditional CAR-T therapy and is therefore classified as a disruptive technology.
When trying to find out the best model for valuation purposes, investors don’t have to look beyond Gilead’s (NASDAQ: GILD) acquisition of Kite Pharmaceuticals for $11.9 billion. MRKR’s current phase 2 results in AML are tracking much better than Kite’s trial results. The safety profile is pristine and unencumbered by the CRS side effect present in almost all CAR-T therapies. Most CAR-T companies like Celgene (NASDAQ: CELG), Nektar Therapeutics (NASDAQ: NKTR), Blue Bird Bio (NASDAQ: BLUE), Iovance (NASDAQ: IOVA) have billion dollar valuations and their therapies are slated to cost over $350,000. How can they compete on a reimbursement basis with MRKR’s Multi TAA approach that only costs $8000/patient. This valuation argument is perhaps why so many class A investors were attracted to the MRKR story.
It seems pretty obvious that Baker Brothers has a “go big or go home” attitude toward biotechs and for them to even consider an investment in a company this small speaks volumes about the strength of the technology and management team. Without having to do any fancy number crunching just based on the AML study, MRKR has a better drug than Kite Pharma and should be trading at a discount to the $11.9 billion takeout price paid by GILD. A 90% discount to the Kite acquisition would put the stock price at $17.00. The Baker Brothers strategy in the past, with big disruptors like SGEN, has been to keep buying as the story evolves. This secondary buying is sure to put a floor on the stock and eventually propel it to new heights. Investors should not forget that Baker Brothers isn’t the only lead investor and the other named institutions like NEA, Aisling, and Perceptive also have excellent track records of picking winners in the life sciences sector. The structural buying and the legendary names in this stock are great reasons to buy but there is also a fundamental story here of a cost effective treatment option in personalized medicine that results in a durable response.
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