IMV Inc. has 50 per cent upside, Mackie Research says

A new development at IMV (Quote, Chart TSX:IMV) has Mackie Research Capital analyst André Uddin maintaining his bullish stance on the stock.

This morning IMV announced it had expanded its clinical program with a phase 2 basket trial evaluating its lead candidate, DPX-Survivac, in combination with low-dose cyclophosphamide and Merck’s anti-PD-1 therapy, Keytruda (pembrolizumab) in patients with select advanced or recurrent solid tumours.

“The clinical data from our recent ASCO meeting presentation demonstrated for the first time the unique potential of DPX-Survivac to generate solid tumour regressions in ovarian cancer,” CEO Frederic Ors said. “We are delighted to expand our clinical program and collaboration with Merck across multiple cancer indications and look forward to investigating the potential added benefit of combining DPX-Survivac and Keytruda.”

Uddin says this could be a catalyst play for IMV.

“DPX-Survivac is now in three clinical programs with Merck,” the analyst explains. “The Phase II basket trial would further expand DPX-Survivac’s potential indications to additional tumor types – which should elevate the candidate’s licensing value and ultimately market potential. Positive outcomes of the studies with DPX-Survivac should facilitate a potential licensing deal.”

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In a research update to clients today, Uddin maintained his “Speculative Buy” rating and one-year price target of $10.40 on IMV, implying a return of 50 per cent at the time of publication.

Uddin thinks IMV will lose $0.36 a share on revenue of $200,000 in fiscal 2018. He expects those numbers will improve to earnings of $0.03 on a topline of $17.1-million the following year.