APS Details

Unique Products Developments which might turn in Long-term Business Potential:  Aptose Biosciences Inc. (TO: APS) is a clinical-stage biotechnology company committed to developing personalized therapies addressing unmet medical requirements in oncology.

Key Points to look at:

• The company filed an Investigational New Drug application to the U.S Food and Drug Administration to initiate its Phase I clinical trial for CG-806. The company informed its initiative for eighteen clinical sites for the Phase Ia/b trial in patients with CLL/SLL or NHL and commenced enrollment of patients on the first, second, and third dose cohorts.
• The company has strong leadership in advance clinical program and has approximately two years of cash to advance for the above programs.
• The business seeks to serve broadly to the CLL and AML patient needs which has a commercial opportunity of more than US$1 Billion. The business seek scope for the rapid clinical POC and value creation with hematologic cancers.
• CG-806 is used for the treatment of AML & Myeloid Malignancies, which is a deadly cancer of Blood/Bone Marrow disease found in orphans. As per the report, in FY19, ~21,450 diagnosis has been conducted, and we believe the scope for this product is enormous.
• However, the studies are in early stage development and the likelihood of approval are extremely low at the initial stages
• In addition, the Company is conducting the trials on a standalone basis, thus potentially missing out on milestone payments.

Financial Highlights for FY19: For the period ended 31 December 2019, the company reported a research and lower development expense of US$16.83 million, as compared to US$18.733 million in FY18. Net loss of the company stood at US$26.259 million, improved from US$28.868 million in previous financial period.

FY19 Income Statement Highlights (Source: Company Reports)

Stock Recommendation: Stock Recommendation: The stock of APS closed at CAD 7.26 with a market capitalization of CAD 553.33 million. The stock made a 52-week low and high of CAD 2.37 and CAD 12.24 and is currently trading close to the upper of its 52-week’s trading range. The company is engaged in preparing medicines for the novel treatment and is in the early stage of its clinical trials, and it’s too early to predict the potential of these drugs owing to the nature of the products. However, on a long-term basis, based on the approvals, the business has a potential to deliver higher business prospects from its products.  Considering the above facts, current trading levels, business prospects, etc., we give a ‘Watch’ recommendation on the stock at the closing price of CAD 7.26, up 11.01% as on 13^th March 2020.

APS Daily Technical Chart (Source: Thomson Reuters)

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