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Updated draft report leeuwenhoeck prr feb

Initiating Coverage Report PRIMA BIOMED
Switching into higher gear in immune therapy Date: 11 February 2015 Prima BioMed
Country:
Australia
AUD 0.036
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Reuters Code:
PRR.AX, NASDAQ:PBMD
Market Cap (AUD m):
EV (AUD m):
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Shares outstanding (m):
2,386,000
Free float:
52-week Range:
0.03-0.07
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Chief Research Analyst Marcel Wijma MSc
+1 (917) 460 6185 (US) +31 (6) 3100 5893 (NL) PRIMA  BIOMED  
PRIMA  BIOMED   3  
Executive Summary  .  5  
1. Company Overview  .  7  
2. Immunotherapy: The new holy grail in cancer?  .  9  
3. LAG3 & CVac: PRR's technology platforms in immunotherapy  .  12  
4. Product Pipeline in Immunotherapy  .  16  
5. Management Capabilities  .  25  
6. Peer Group Analysis  .  30  
7. Recent headlines  .  34  
8. Patents Coverage  .  36  
9. SWOT Analysis  .  37  
10. Financials  .  38  
11. Valuation  .  40  
Glossary  .  42  
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Executive Summary • Prima BioMed Ltd is globally active biotechnology company that is striving to become a leader in the development of immunotherapeutic products for the treatment of cancer. Its lead product is CVac™, an autologous dendritic cell-based cancer vaccine currently in clinical trials for ovarian cancer patients in remission, and soon starting a pilot trial for resected pancreatic • End of last year, the company announced that CVac™ demonstrated a clear improvement in Overall Survival over Standard of Care in second remission ovarian cancer patients using CVac™. This data follows the very positive Progression Free Survival data for second remission patients from CAN-003 announced in May 2014. • With the acquisition of Immutep SA, Prima BioMed considerably strengthens its presence in the fast growing immuno-oncology (IO) area. Immutep's pipeline of immunotherapies offers a very good match to Prima BioMed's proprietary CVac™ technology and transforms the company from a single-product company into one with a broad and exciting pipeline in immunotherapy. It has gained two clinical programs that are based on the proprietary LAG-3 technology and two preclinical programs that are expected to enter the clinical in the next few months. • Lead program based on the LAG-3 program is IMP321, a chemoimmunotherapy aimed at activating the APC (antigen presenting cells) network in the body. Prima BioMed intends to start two new clinical trials with IMP321, a Phase IIb trial in metastatic breast cancer (focus on PRIMA  BIOMED   5  
EU) and a Phase I trial in combination with other IO options (focus on US). • Certain important news expected in the next 12 months could drive the stock up. This includes the start of the pilot trial in resected pancreatic cancer with CVac, the start of the Phase IIb and Phase I studies with IMP321, and the Phase I studies with IMP731 in autoimmune disease and IMP 701 in chronic infectious disease. Next to that, we expect the receipt of potential milestone payments from the development partners, patent applications and the receipt of potential funding grants. • As of September 2014, the company had AUD 19.9 million in cash. Linked with the acquisition of Immutep and to safeguard the development of the newly acquired pipeline, Prima BioMed has negotiated a financing arrangement with Bergen Asset Management. Bergen invested an initial sum of USD 2.5 million in a 36-month interest-free convertible security. It will also make monthly investments of up to USD 1.5 million for 24 months up to a maximum of USD 34.9 million. Prima BioMed has the option to terminate the arrangement when alternative funding is found. • Based on our adjusted NPV valuation, we believe Prima BioMed is
substantially undervalued at the current share price of AUD 0.04. Using our valuation model, the Company's total value is AUD 150 million, or AUD 0.11 per share. This represents a 175% upside from the current share PRIMA  BIOMED  
1. Company Overview Prima BioMed Ltd is a leading biotech company in the development of personalized immunocellular therapeutics for the treatment of cancer. Its lead product is CVac™, an autologous dendritic cell-based cancer vaccine currently in clinical trials for ovarian cancer patients in remission, and a pilot trial for resected pancreatic cancer in remission. A further pipeline of products is based on the LAG-3 immune control mechanism which plays a vital role in the regulation of the T cell immune response. The most clinically advanced product is a T cell immunostimulatory factor (APC activator) IMP321 for cancer chemoimmunotherapy which has completed early Phase II trials. A number of additional LAG-3 products including antibodies for immune response modulation in autoimmunity and cancer are being developed by large pharmaceutical partners. Prima BioMed is listed on the Australian stock exchange, on the NASDAQ in the US and in Germany on the Deutsche Börse in an entry standard. Business Strategy
Given the high costs, long development times and high attrition rates associated
with drug development, many biotechnology companies seek the assistance of a pharmaceutical partner to advance their products through clinical trials. In 2014 Prima BioMed executed a license agreement with the Neopharm Group to market and sell CVac™ in Israel and the Palestinian Authority. Other territories are open for The various LAG-3 products have been commercially partnered with different PRIMA  BIOMED   7  
The Phase II program for metastatic breast cancer is partnered with Eddingpharm and licensed in China and Taiwan; Eddingpharm is a fast growing specialty pharmaceutical company in the Chinese market, committed to actively introducing quality products into China's pharmaceutical market. The Company focuses on the development and promotion of pharmaceutical products in four therapeutic areas: clinical nutrition, oncology, antibiotics and respiratory system. Eddingpharm has established long-term cooperative relationships with a number of multinational pharmaceutical companies and overseas specialty pharmaceutical companies, and has built up a competitive product portfolio and pipeline in the four major therapeutic areas. The Phase I program in autoimmune diseases is partnered with GlaxoSmithKline; The pre-clinical program in immune checkpoint blockade for cancer immunotherapy is partnered with Novartis. In addition, Prima has an ongoing collaboration with the Fraunhofer Institut für Zelltherapie und Immunologie (IZI) (Germany). Other collaborations relating to manufacturing of IMP321 include WuXi AppTec (China). PRIMA  BIOMED  
2. Immunotherapy: The new holy grail in cancer? We are now on the brink of a huge change in how we treat cancer. An arms race is on to upgrade our own naturally present immune cells to overcome the shifting defenses used by cancer to survive. Like nearly all new technologies, there have been false starts and reversals over the past years, but serious progress is now being The basic idea behind this technology is not new. Over 150 years ago, physicians began to notice how patients with cancer who also developed infections could get better. The infection did not even have to be at the same site as the tumor: Growing tumors would sometimes shrink after a bad fever caused by a systemic infectious disease. This led some early oncology pioneers to devise injectable bacterial cocktails that occasionally worked. These researchers hypothesized that the pathogens worked either by directly attacking cancer cells or by waking up a sleepy immune system. This form of therapy we have come to call immunotherapy. Despite improvements in the survival rates of patients suffering from most types of cancer over the last 50 years due to advances in diagnosis, surgery, and drug treatment, current treatment remains inadequate. Not only does treatment in general only extend life expectancy for a matter of months but it is associated with significant toxicity. The unpleasant side effects of chemotherapeutic regimes including nausea, diarrhea, hair loss, myelosuppression and cardiac toxicity are tolerated only because treatment can be the only chance of survival. Indeed, it is estimated that up to 30% of patients on some chemotherapy regimes die as a result of complications from the treatment itself. That is now changing fast — and it is the smaller biotechnology innovators like Prima BioMed that are leading the charge. We are reaching a turning point in PRIMA  BIOMED   9  
immunotherapy research. With hundreds of programs under development, it is now a heavily researched oncology field. These epochal shifts in cancer technology have been seen before, so this is not something new. What is new is the rate of change, which is accelerating. Antibody- based therapies, for example, were almost science fiction-esque in the early 1980s. By the '90s, however, the first antibody therapies against cancer were approved. Now there are dozens of marketed mAbs (monoclonal antibodies), with many more on the way — and the market is vast. The immunotherapy market will also be enormous — and it is only just starting to take off. Citigroup analysts estimate that the market will generate USD 35 billion per year over the next 10 years as existing therapies grow market share and new therapies enter commercialization. So there is a lot of gold in those hills. Cancer vaccines like CVac are a viable option for treating many types of cancers, which in the present day do not have effective treatments. Therapeutic cancer
vaccines and prophylactic cancer vaccines are the two broad segments into which the cancer vaccines market is categorized. Therapeutic vaccines are targeted at treating an existing cancer by strengthening the body's natural defenses against the cancer and the Prophylactic or Preventive vaccines are used to prevent cancer from developing in healthy people. With the approval of the expensive prostate cancer vaccine, Provenge by Dendreon in 2010, the field of cancer vaccines has received an unprecedented boost. Consequently, many companies are expected to enter this emerging and highly profitable field of preventing, treating, and potentially curing Cancer vaccines are known to earn a higher profit than the generic drugs, owing to the nature of the disease and the urgency in the demand for these vaccines. The US 10   PRIMA  BIOMED  
cancer vaccine market was estimated to be worth USD 14 billion in 2012. The market is expected to witness an increase of 1.5 million people being diagnosed with cancer annually. With such a rapid increase in incidence, the US cancer vaccine market is expected to grow at a CAGR of 10% to surpass USD 20 billion by 2018. The market for cancer vaccines is in its growth stage in the US and has great opportunities for entry. The USA alone accounts for a dominating share of 50% as compared to a combined share of 50% accounted for by Europe and other regions. PRIMA  BIOMED   11  
3. LAG-3 & CVac: PRR's technology platforms in With the acquisition of Immutep end of last year, Prima BioMed has expanded its clinical portfolio to other categories of immunotherapies beyond cancer vaccines, including Prima BioMed's existing CVac technology. In the field of cellular therapies, the CVac technology platform is used to turn on the immune system to attack cancer cells. The LAG-3 platform provides a good combination for a total approach in cancer immunotherapies. With the LAG-3 antibodies IMP731 and IMP701 the effect is to release the brakes on the immune system, whereas the LAG- 3 activator IMP321 has the function to push the accelerator as a strong immune activator (see below). Source: Prima BioMed 12   PRIMA  BIOMED  
It therefore makes perfect sense for each of the three products to be developed in parallel, as they are complimentary therapies with their use dependent on the condition of the individual patient. CVac: Autologous dendritic cell immunotherapy
CVac therapy is designed to generate an immune response against tumour cells, by priming the immune system to recognise cells that express an abnormal for of the MUC1 (mucin 1) protein. This abnormal MUC1 is highly expressed on cancer cells, e.g. up to 83% on ovarian cancer. During treatment, a patient's white blood cells are collected during a process called apheresis, and the mononuclear cells (a class of white blood cells) are matured into dendritic cells and incubated in the presence of a fusion protein that contains part of the MUC1 protein. These modified dendritic cells (CVac), when they are injected back into the patient, should cause the formation of cytotoxic T-cells, which recognise and destroy MUC1-expressing tumour cells. In the immune system, dendritic cells play the important role of processing foreign or abnormal proteins and presenting antigens derived from these proteins to T-cells. This leads to the formation of CD8+ T-cells, which are cytotoxic, and CD4+ T-cells, which are "memory" cells for the immune system. So CVac, dendritic cells pulsed with the M-FP fusion protein, presents MUC1 antigens to T- cells, and subsequent formation of T-cells specific to MUC1. Data from previous clinical trials (CAN-001 and CAN-003) confirm that a MUC1 specific immune response is induced by CVac. Although each of Immutep's products and CVac are standalone products they can be potentially combined with other immuno-therapies, such as checkpoint inhibitors or chemotherapy, and these combination therapies are increasingly being recognised in the scientific and medical community as optimal approaches for PRIMA  BIOMED   13  
fighting cancer. LAG-3: Dual Technology platform in immunotherapy
LAG-3 stands for "Lymphocyte Activation Gene-3" and is involved in the regulation of T cells in immune responses. On activated T cells it is an inhibitory receptor that down-modulates their proliferation and activation. LAG-3 is one of the few key molecules that have been identified as being responsible for the regulation of T cells. LAG-3 is important as it plays a number of roles that can both activate or
suppress immune responses, which makes it an attractive target for immunotherapy, both in cancer treatment and autoimmunity. Both fields are similar in essence as human tumours are frequently deeply infiltrated by active T cells, and the tumour could then be considered as an autoimmune site where the T cell response has just not been strong enough to eliminate these abnormal tissue cells. In immuno- oncology multiple tumour masses disappear in advanced metastasised cancer by just unleashing the power of this tumour infiltrating T cell. Cancer cells are evading the immune system, or providing signals to the immune system that stop them from being killed. Quite often inside or around a tumour T cells can be found, but they have been switched off by inhibitory molecules like LAG-3 or PD-1 that are expressed from the T cell surface. T cells recognise abnormal cancer cells but their ability to cure the tumour cells they have recognised is hampered by the inhibitory molecules. Since these inhibitory checkpoints LAG-3 or PD-1 are expressed on the cell's surface, they are easily accessible with therapies. They could be blocked by the corresponding antibody. In the case of anti-PD-1 antibody the drug used is Keytruda, an antibody from Merck that was been approved in 2014 for the treatment of advanced melanoma. Apart from using the antagonistic properties of antibodies to LAG-3, Immutep has
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developed a first-in-class agonist, which is an activator, that is actually put in by cutting off the agonist of LAG-3 and using this now soluble truncated LAG-3 protein as a tool to activate APCs. So it is an APC activator. APC's like dendritic cells or monocytes are mobile cells that are attracted to the site of inflammation caused by a virus or a tumour. There the APCs digest the proteins released by dying cells and then migrate to the draining lymph node to activate T cells specific for this viral or tumoral antigen. In other words specific anti-tumoral T cell activation is always triggered by APC, and this essential function of T cell education on activation is reflected by their name Antigen Presenting Cell. Boosting APC activation is a way to increase the number of T cells specific for these tumour antigen that accumulate at the tumour site thereby boosting the natural capacity of the body to control PRIMA  BIOMED   15  
4. Product Pipeline in Immunotherapy Following the acquisition of Immutep SA, Prima BioMed has transformed from a one-product company to one with an exciting pipeline of immunotherapy assets. It acquired the private French company, Immutep, for a total sum of up to USD 25 million to obtain a pipeline of two clinical assets (one partnered with GSK) and a preclinical development program. The products in development are based on the so called LAG-3 (Lymphocyte Activation Gene 3) technology. LAG-3 is one of the few key molecules that have been identified as being responsible for the regulation of T cells. LAG-3 is important as it plays a number of roles that can both activate or
suppress immune responses, which makes it an attractive target for immunotherapy, both in immuno-oncology and autoimmunity. Immutep provides us with exactly the right kind of technology to compliment Prima's expertise while bringing in a diverse pipeline of new products, some of which already have established partnerships with large pharmaceutical companies. As a result, Prima will have a considerably broader and more balanced portfolio of opportunities in the very sought after area of cancer immunotherapy. Although each of the Immutep products and CVac are standalone, they can also potentially be combined with other approaches such as checkpoint inhibitors or chemotherapy. This opportunity presents itself at a time when the scientific and medical community are moving towards combining immunotherapy strategies to try to effectively treat cancer. Prima can potentially earn revenues from milestone payments at various stages in the respective development programs of its pharma partners, as well as from royalties once the products are marketed. 16   PRIMA  BIOMED  
Next to the further LAG-3 pipeline, Prima Biomed also makes excellent progress with its lead product CVac in patients with second remission ovarian cancer. This CAN-003 trial shows at least a 10 month median survival advantage compared to patients with standard of care (SOC) treatment. This means that second remission patients treated with CVac are living much longer and are 83% less likely to die compared to SOC patients. The data further validates Prima BioMed larger phase II CAN-004-B trial that has Overall Survival (OS) as the primary endpoint and Progression Free Survival (PFS) as a secondary endpoint. We expect the final data to be published towards the end of the first half of 2015. With CVac's CAN-301, Prima BioMed also started a single arm phase II trial in resected pancreatic patients in remission. Up to 40 patients will be enrolled with the primary endpoint to evaluate safety and tolerability of CVac in patients that are in remission with resected stage I or stage II pancreatic cancer as a maintenance treatment. Secondary endpoint is to assess the duration of PFS and OS. Clinical Pipeline
Source: Prima BioMed PRIMA  BIOMED   17  
Overview of clinical trials
Phase Protocol
Population
Patients Status
Terminal cancer (breast, ovarian, fallopian tube, colon, lung esophageal) Ovarian cancer with no further treatment Ovarian cancer patients in remission after first or second line therapy Ovarian cancer patients who have progressed on CAN003 Ovarian cancer patients in remission after 1st line surgery and chemotherapy Ovarian cancer patients in remission after 2nd line surgery and chemo Patients with resected stage I or stage II Stage IV renal cell cancer Metastatic breast cancer Healthy volunteers with influenza antigen Healthy volunteers with hepatitis antigen Disease free melanoma Metastatic melanoma Metastatic melanoma Source: Prima BioMed
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Clinical program IMP321
With IMP321, ten clinical trials are completed or ongoing. The corresponding protocols are termed P001 to P010. The first trial of IMP321 tested alone
(monotherapy) has shown that 6 mg is the effective dose to increase over time the number of long-lived effector-memory CD8 T cells (i.e. immune cells responsible for tumour regression) in all patients. It also significantly increases the percentage of progression-free survival patients at the post-study visit. The chemo-immunotherapy trials are to provide therapeutic efficacy proof-of-concept in man in indications with very large potential markets. Overall, more than 600 s.c. injections of IMP321 have been administered since 2005 and the product has a good local and systemic tolerability profile. The product is also non-immunogenic (i.e. anti-IMP321 antibodies were not detected). IMP321 is used in two ways: • high dose (e.g. >1 mg) as a monotherapy alone or combined with standard chemotherapy (chemo-immunotherapy) • low dose (e.g. 250 µg) as adjuvant in therapeutic vaccines The high dose use as a monotherapy was first tested in metastatic renal cell carcinoma patients (P003) starting at a very low level (0.05 µg) in September 2005 and then increasing the dosage to 30 mg. The product given 6 times s.c. over 3 months was well tolerated. With this safety data, the first chemo-immunotherapy trial was started in 2006 with 12 injections given the day after chemotherapy in metastatic breast cancer (MBC) patients receiving first-line weekly paclitaxel (P005). A second chemo-immunotherapy trial was started in 2009 in pancreatic cancer PRIMA  BIOMED   19  
Metastatic breast cancer trial
In July 2006 Immutep started a Phase I/IIa trial where IMP321 was given (0.25, 1.25 and 6.25 mg s.c. 12x q14, 30 patients) the day after paclitaxel (80 mg/m2) for 6 months, as a first line therapy for metastatic breast cancer. In this study Immutep used the weekly, 3 weeks out of 4, paclitaxel regimen which was introduced to reduce cumulative neurotoxicity observed with weekly paclitaxel administration. The repeated single doses of IMP321 were administered on day 2 and day 16 of the 28-day paclitaxel cycle. Thus, the injections of IMP321 were separated by 13-day intervals. This repeated dose injection protocol had previously been shown to be safe and well tolerated for doses up to 30 mg in advanced renal cell carcinoma No clinically significant adverse event related to IMP321 was reported. Fifteen tumor regressions out of 30 patients were observed at 6 months which is twice the response rate expected in this setting (i.e. a 25 % response rate to first-
line chemotherapy). There were also 12 stable disease and only three progressors (10%) giving a 90% clinical benefit. Both compared favorably with the historical control group as shown below. 20   PRIMA  BIOMED  
Improvements in the use of traditional breast cancer therapies have decreased the morbidity and mortality of breast cancer treatment, and improved the overall survival of women with early stage disease. The development of targeted drugs such as aromatase inhibitors (anastrozole (Arimidex), letrozole (Femara), and exemestane (Aromasin)), fulvestrant (Faslodex), and trastuzumab (Herceptin) has improved the quality of life for women with advanced disease. Current adjuvant trials are likely to demonstrate that these newer therapeutics will add an additional survival benefit for women with early breast cancer. Despite these remarkable advances, approximately 40% of women continue to fail current primary management strategies for early breast cancer, and ultimately succumb to their disease. Furthermore, although women with metastatic disease can enjoy a good quality of life on therapy, metastatic breast cancer remains incurable. The failure of current management approaches is generally attributed to the outgrowth of breast tumour PRIMA  BIOMED   21  
cells that are inherently resistant to standard treatments. Together, these observations underscore the need for unique approaches that can either overcome or circumvent intrinsic mechanisms of resistance to standard therapies. Manipulating the immune system to recognize and eradicate breast tumour cells is a highly attractive alternative approach to disease management. Clinical program CVac
CAN-003: Ovarian cancer in remission
CAN-003 is a 63-patient Phase II study evaluating the effects of CVac, as compared to an observational standard of care arm (SOC), in epithelial ovarian cancer patients in complete remission after first or second line treatment. In accordance with the protocol design, the first seven patients on the trial were all assigned to receive CVac in order to test the comparability of product manufacturing in a new facility. The subsequent 56 patients were randomized 1:1 to either the CVac group or SOC and included in the intent-to-treat analysis. 36 patients were in first remission (19 patients were assigned to CVac and 17 to SOC) and 20 patients were in second remission (10 patients were each assigned to CVac or SOC). Final PFS data analyzed after thorough quality control reviews of investigator evaluated progression and appropriate censoring of data from patients who had not progressed during the study. The primary objectives of the trial were to determine the safety of CVac administration and to determine CVac's effect on progression- free survival. Secondary objectives of the trial were to determine CVac's effect on Overall Survival and to evaluate host immunologic responses to CVac. In November 2014, the company announced that the Overall Survival data continued to show benefit for second remission ovarian cancer patients. In second remission patients (n=20) from CAN-003, the median for SOC patients was 25.53
22   PRIMA  BIOMED  
months which is consistent with current literature. By comparison, for patients treated with CVac a median has still not yet been reached after 36 months (current (hazard ratio=0.17 (95%CI: 0.02, 1.44); p=0.07). This implies at least a 10 month median survival advantage for second remission patients treated with CVac. This means second remission patients treated with CVac are living significantly longer and are 83% less likely to die compared with SOC patients. This follows the very positive Progression Free Survival ("PFS") data for second remission patients from CAN-003 announced in May 2014. CAN-004: Ovarian cancer in second remission after surgery and chemo
In April 2014, Prima BioMed started an amended Phase II clinical trail in Europe for the treatment of ovarian cancer. The amended Phase II CAN-004 clinical trial will include up to 210 epithelial ovarian cancer patients in remission after second-line platinum-based chemotherapy. The primary endpoint will be Overall Survival, while the secondary endpoints will include progression-free survival, adverse events and immune monitoring. The first patient has been recruited onto the trial Prima BioMed is recruiting further patients from 21 active sites across Further sites are due to commence recruitment in due course. Prima BioMed will be providing quarterly progress updates on the recruitment process. The amended 210 patients CAN-004 trial follows Prima's CAN-003 trial, which demonstrated that CVac increased progression-free survival in patients who were in remission after second-line therapy. The commencement of the amended trial follows approval being received from several European regulatory agencies. In collaboration with the Fraunhofer Institute for Cell Therapy and Immunology, Prima BioMed will manufacture CVac for all of the European clinical trial sites from its central manufacturing facility in Leipzig, Germany. PRIMA  BIOMED   23  
Ovarian cancer is the seventh most common cancer in women worldwide, with approximately 239,000 new cases diagnosed in 2012 according to Globocan statistics. Ovarian cancer often has no symptoms at the early stages, so the disease is generally advanced when it is diagnosed. The most common type is epithelial ovarian carcinoma accounting for 85 to 90% of ovarian cancers. These tumors arise in the cell layer covering the outer surface of the ovaries. The chemotherapy drug most commonly used to treat ovarian cancer is carboplatin. It may be given on its own or in combination with the chemotherapy drug paclitaxel (Taxol). 24   PRIMA  BIOMED  
5. Management Capabilities Prima BioMed is being built by seasoned biotechnology innovators. The company is led by an experienced Board and management team, which has been responsible for the rapid development of the business and has a successful track record of developing, protecting and commercializing innovative scientific products and processes. In the past several years, Prima BioMed has been investing in developing a team of experts that have a focus on patient outcomes and can deliver results. Its board and senior management team are highly experienced in the development and early stage commercialisation of immunocellular therapeutics. Management Team
Marc Voigt, Chief Executive Officer
Mr. Voigt has served as Prima BioMed's Chief Financial Officer and Chief Business
Officer since 2012 and was appointed as CEO and Executive Director in July 2014. He has extensive experience in the corporate and biotechnology sectors. He joined Prima BioMed's management team in 2011 as the General Manager of the company's European operations. He has previously worked as an investment manager for Allianz Insurance biotech venture fund, and as a personal assistant to a member of the Executive Board of Allianz Insurance. Mr. Voigt has also worked for German investment bank, net.IPO.AG, in the area of business development and German securities offerings. In the biotech sector, he has held the positions of CFO/CBO at Revotar Biopharmaceuticals AG and Medical Enzymes AG. He has a Masters Degree in Business Administration from the Freie Universität of Berlin, and is a member of the pharma licensing club Germany and a member of the judging panel of Germany's largest business plan competition. PRIMA  BIOMED   25  
Prof Frédéric Triebel, MD PhD, Chief Scientific Officer & Chief Medical Officer
Prof Frédéric Triebel, MD PhD, was the scientific founder of Immutep S.A. (2001) and served as the Scientific and Medical Director at Immutep from 2004. Before starting Immutep, he was Professor in Immunology at Paris University. While working at Institut Gustave Roussy (IGR), a large cancer centre in Paris, he discovered the LAG-3 gene in 1990 and continued working on this research program since then, identifying the functions and medical usefulness of this molecule. He headed a research group at IGR while also being involved in the biological follow-up of cancer patients treated in Phase I/II immunotherapy trials. He was Director of an INSERM Unit from 1991 to 1996. First trained as a clinical haematologist, Prof Triebel holds a PhD in immunology (Paris University) and successfully developed several research programs in immunogenetics and immunotherapy, leading to 144 publications and 16 patents. Sharron Gargosky, PhD, Chief Technical Officer
Dr Gargosky has more than 17 years' experience in the biotechnology and
pharmaceutical industries and was responsible for successful FDA approval for orphan drugs. She is leading the clinical development, as well as the scientific and technical advancement, of CVac globally. Dr Gargosky previously held the positions of Chief Scientific Officer at Pulse Health LLC, USA and Chief Scientific Officer and Senior Vice-President of Corporate Development at Hyperion Therapeutics Inc., USA. At Ucyclyd Pharma she managed the development and approval of orphan drug products in the metabolic, small molecule therapeutics and within Medicis Pharmaceuticals, the successful BLA submission of Reloxin®. As Vice-President of Business Development for Diagnostic System Laboratories, she was responsible for business expansion through evaluation and implementation of new growth opportunities and patent portfolio management. Dr Gargosky did her postdoctoral fellowship at Stanford University in California and has a PhD in 26   PRIMA  BIOMED  
biochemistry from University of Adelaide in Australia (in collaboration with CSIRO Divisions of Human Nutrition), First Class Honors in Biochemistry, and a Bachelor of Science, Biochemistry (Distinction), Microbiology, Immunology & Virology (Distinction) from the University of Adelaide. Ms Deanne Miller, General Counsel & Corporate Secretary
Ms Miller has over 13 years of broad commercial experience, having held legal, investment banking, regulatory, and tax advisory positions, including Associate Director at Westpac Group, Legal & Compliance Manager at Macquarie Group, Regulatory Compliance Analyst at the Australian Securities and Investment Commission, and Tax Advisor at KPMG. She joined Prima BioMed as General Counsel and Company Secretary in October 2012. Ms Miller holds a Bachelor of Laws (Hons) and Bachelor of Commerce from the University of Sydney. She is admitted as a solicitor in NSW and is a member of the Law Society of NSW. Larisa Chisholm, Business Development and IP Manager
Ms Chisholm has worked for Prima BioMed since 2003. Prior to her current role, she worked for 5 years at the Burnet Institute (formerly the Austin Research Institute) where the CVac technology originated. Ms Chisholm has a Bachelor of Science (Hons) majoring in Biochemistry and Genetics and a Masters Degree in Business Administration. Her current role within the Business Development Team is to assist with the identification of in-licensing and out-licensing opportunities. Ms Chisholm is also responsible for the management of the intellectual property portfolio licensed to Prima for the development of CVac. Frank Fliegert, MD, Global Medical Director
Dr Fliegert studied medicine at the Medical School Hannover, Germany. He PRIMA  BIOMED   27  
received his medical degree in 1993 and went on to specialize in experimental and clinical pharmacology at the University of Aachen, Germany. In 1999, he joined Grünenthal where he gained more than 8 years' experience in various R&D positions. Dr. Fliegert was focusing on the early clinical development of several NCEs entering the therapeutic areas of acute and chronic pain. The most advanced drug candidate was the opioid analgesic Tapentadol® that has been approved by the FDA in November 2008. Since leaving Grünenthal, Dr. Fliegert worked for the Allianz Private Health Insurance, Munich, Germany where he led a group analyzing the cost-effectiveness of drug therapies. In February 2009, he joined NOXXON, Berlin, Germany as Vice President Clinical Development. In this position, he was responsible for the clinical development of three oligonucleotide- based therapeutics targeting inflammatory diseases, hematological disorders and various cancers. These programs have recently been advance to the stage of clinical proof-of-concept. In 2012, Dr. Fliegert joined Boehringer-Ingelheim, Biberach, Germany as Clinical Pharmacology Program Leader. He was involved in the early clinical development strategy of six NCEs in various CNS therapeutic areas. Before joining Prima BioMed in June 2014, Dr. Fliegert served as Head of the Clinical Pharmacology Unit at SynteractHCR, Munich, Germany. Michael Buchholz PhD, Director Manufacturing
Dr Buchholz joined Prima BioMed Ltd., in September 2012, as a Project Manager Manufacturing in Europe. Prior to his current role, he was a project manager at the Fraunhofer IZI, a contract manufacturer with expertise in manufacturing of cell- and tissue-based investigational medicinal products according to "Good Manufacturing Practice" (GMP). As a project manager he was responsible for the oversight on the CVac project for the client Prima BioMed. Dr. Buchholz was involved in the initial tech transfer and in establishing the GMP compliant CVac process at the European 28   PRIMA  BIOMED  
CMO Fraunhofer IZI. Dr. Buchholz completed his PhD at the Centre for Regenerative Medicine at the University of Bath and has a degree in Biochemistry from the Free University in Berlin. Christian Toloczyki PhD, Director Quality Assurance
Dr Toloczyki has more than 25 years' experience in the pharmaceutical, biotechnological and medical device industries and has gained a strong background in Quality assurance processes by different positions with responsibility for development, testing, production and quality control. He started as a Product Manager in the pharmaceutical and OTC business at a German affiliate of American Home Products Corp. At Curative Technologies Inc., a company that produced and distributed autologous blood products, he held the position as Marketing Director. At BSL Bioservice GmbH, which he co-founded he was the General Manager. This company offers GLP certified pre-clinical and biosafety testing services for pharmaceutical, chemical and medical device industry. As an entrepreneur, he founded BioCare, developing a tissue engineered skin product to marketability; including establishment of GMP certified production, distribution and reimbursement by health insurances, and also Systherm, where he Before joining Prima Biomed in 2013 he worked for Euroderm for five years, a company developing, producing and distributing biotech and tissue engineered medicinal products. He held the positions as Chief Scientific Officer, Qualified Person, Head of Quality Control, Pharmacovigilance Manager and Head of Regulatory Affairs. Dr Toloczyki owns a PhD in Molecular Biology and a Diploma in Biochemistry, Physiology, Genetics and Pharmacology. PRIMA  BIOMED   29  
6. Peer Group Analysis Peer Group Company Profiles

Bavarian Nordic
Bavarian Nordic is a Danish based biotechnology company developing and
manufacturing cancer immunotherapies and vaccines for infectious diseases. One of its lead product candidates is PROSTVAC®, an immunotherapy product candidate for advanced prostate cancer that is the subject of an ongoing pivotal Phase III clinical trial. Next to that the company is developing its proprietary platform in immunotherapy called CV301 (originally developed as PANVAC). CV- 301 (originally developed as PANVAC) is a targeted immunotherapy product candidate in clinical development for colon, breast, and other cancers. Like PROSTVAC®, CV-301 is intended to be ready to use with minimal preparation. CV- 301 employs the same poxvirus-based active immunotherapy platform and TRICOM natural human immune-enhancing costimulatory molecules (B7.1, ICAM- 1, and LFA-3) as PROSTVAC. CV-301, however, specifically targets 2 tumor- associated antigens: Carcinoembryonic antigen (CEA), which is overexpressed in certain cancers of the colon, rectum, stomach, and pancreas, and Mucin-1 (MUC-1), which is overexpressed in endothelial cancers, such as colorectal, lung, and breast 30   PRIMA  BIOMED  
OncoThyreon
Oncothyreon is a clinical-stage biopharmaceutical company specializing in the
development of innovative therapeutic products for the treatment of cancer. The company's current clinical-stage product candidates include ONT-380, an orally active and selective small molecule HER2 inhibitor, and ONT-10, a therapeutic vaccine targeting MUC1. Oncothyreon is currently conducting a Phase I trial of ONT-10 in patients with solid tumours (NCT01556789). This trial is a two-part dose and schedule escalation study to evaluate the safety and immune stimulating capacity of repeat dose vaccination with ONT-10 in patients with previously treated stage 3 or 4 solid tumours. Part 1 is designed to evaluate escalating doses of ONT- 10 administered subcutaneously every two week or weekly over eight weeks. Part 2 will further evaluate the safety, immunogenicity, and potential anti-tumour activity of ONT-10 at the maximum tolerated dose/recommended dose and schedule from Part 1 in two disease-specific indications (breast and ovarian carcinoma). It is estimated the trial will enrol up to 78 patients. Oncothyreon is also conducting a Phase Ib maintenance study (NCT01978964) of ONT-10. This trial is enrolling patients who have already participated in the initial Phase I trial described above, and who have demonstrated clinical benefit in that trial. Patients in this maintenance study will receive ONT-10 every 6 weeks. The primary outcomes measure is the incidence and severity of adverse events (AEs) and lab abnormalities; secondary outcome measures are immunogenicity, anti-tumor activity, assessments of antibody and T-cell responses, and overall response. PRIMA  BIOMED   31  
Transgene
Transgene (NYSE-Euronext: TNG), a member of the Institut Mérieux Group, is a
publicly traded French biopharmaceutical company focused on discovering, developing and manufacturing targeted immunotherapies for the treatment of cancer and infectious diseases. Transgene's programs utilize well-tolerated viruses with the goal of indirectly or directly killing infected or cancerous cells. The Company's two lead clinical-stage programs are: TG4010 for non-small cell lung cancer and Pexa-Vec for liver cancer. TG4010, a MUC1 targeting immunotherapy, is in development for the treatment of metastatic NSCLC in combination with first- line chemotherapy. TG4010 is a recombinant vaccinia virus of the Ankara strain (MVA) expressing the coding sequences of the MUC1 antigen and of the cytokine, Interleukin-2 (IL2). In tumor cells, several modifications of MUC1 can occur: over expression, hypo-glycosylation and changes in cellular localization. These changes transform the MUC1 protein into a highly immunogenic tumour associated antigen (TAA) and make it an attractive target for cancer immunotherapy. Thus, the strategy is to induce MUC1 antigen expression in a non-tumour environment, i.e., where the immune system is fully functional, in order to induce both innate and MUC1 specific adaptive immunity. In addition to NSCLC, the MUC1 TAA is expressed in many other solid tumour types, such as lung, breast, colorectal, kidney and prostate cancers. The work related to TG4010 is a contribution to ADNA (Advanced Diagnostics for New Therapeutic Approaches), a program dedicated to personalized medicine, coordinated by Institut Mérieux and supported and partially funded by the French public agency, BPI.
Glycotope
Glycotope specializes in the glycosylation of proteins and is one of Germany's
largest independent biotech companies. Glycotope has a broad portfolio of drugs in 32   PRIMA  BIOMED  
clinical development, including the cancer drugs, PankoMab-GEX™ and CetuGEX™, both in Phase IIb trials, and TrasGEX™, which has successfully completed its Ph I/IIa trial. PankoMab-GEX™ is the first fully human glycosylated and glycooptimized antibody against a novel tumor-specific carbohydrate-protein mixed epitope (TA-MUC1) abundantly present on a larger set of tumor indications, metastasis and cancer stem cells, and virtually absent on normal cells. The double- blind, randomized, placebo-controlled Phase IIb study is designed to evaluate the efficacy and safety of maintenance therapy with PankoMab-GEX™. A total of approximately 210 patients suffering from recurrent ovarian carcinoma and at least stable under current chemotherapy are planned to be enrolled at 41 sites in seven European countries and Russia. The primary endpoint of the Phase IIb trial is progression free survival. Secondary endpoints include further efficacy data such as time to progression, objective response rate, clinical benefit rate and overall survival as well as pharmacokinetic and safety data. Vaxil Biotherapeutics
Vaxil BioTherapeutics (TASE:VAXL), is a clinical stage company developing a new
class of synthetic therapeutic and preventive vaccines with promiscuous antigen specific T and B-cell activation, based on its proprietary VaxHit technology. Vaxil's lead product, ImMucin, teaches the patient's immune system to identify and destroy cells which display a short specific portion (domain) from the cancer marker MUC1 (which appears on 90% of all cancers cells but not in patients' blood, a factor which can enhance its potency. In 2013, Vaxil completed a Phase I/II clinical study with ImMucin on multiple myeloma patients. The study succeeded in meeting all endpoints. Vaxil is currently planning a Phase II study using ImMucin in multiple myeloma. Vaxil has also initiated a Phase I/II study using ImMucin to treat patients with advanced metastatic breast cancer who are also receiving hormone therapy. PRIMA  BIOMED   33  
7. Recent headlines January 27, 2015: Prima receives financial milestone payment from GSK January 20, 2015: Prima receives AUD 777k R&D Tax Incentive Refund December 22, 2014: Canadian Patent granted for Immutep's IMP321 December 17, 2014: Prima completes Immutep Acquisition December 15, 2014: Prima initiates Pancreatic Clinical Trial with CVac December 5, 2014: Prima enhances CVac manufacturing and logistics capability November 6, 2014: CVac demonstrates Overal Survival Benefit in second remission ovarian cancer October 14, 2014: Prima announces Immutep's IMP321 Patent Application granted in Australia October 2, 2014: Prima secures USD 37.4 million investment agreement with US institutional investor Bergen Prima receives US patent grant for CVac Prima appoints Marc Voigt as new CEO CVac demonstrates Positive trend in Overal Survival in second remission Ovarian Cancer Prima's CVac Patent Application granted in US CVac demonstrates improvement in progession free survival in second remission Ovarian Cancer CVac granted Fast Track Designation by FDA Third quarter results CAN-004 Phase II trial for CVac commences recruitment 34   PRIMA  BIOMED  
Prima receives AUD 1.6 million Tax Incentive Refund February 21, 2014: Prima and NeoPharm Group Execute final agreement for CVac license February 6, 2014: CAN-004 clinical trial amendment approved in several countries including the US January 29, 2014: Second quarter results PRIMA  BIOMED   35  
8. Patents Coverage Pivotal to the development and commercialization of any biotechnology company is strong intellectual property protection for the underlying technology and product For CVac, Prima BioMed currently holds a licence from the Burnet Institute in Melbourne to two key patent families that are necessary for its manufacture and administration. As of July 2014, all patents in the Burnet licensed portfolio have been granted. Prima currently protects its CVac trademark with registrations in key international territories. For the LAG-3 technology there are 11 patent families in the portfolio at various stages of maturity. Three background families are licensed in from Merck-Serono and protect the LAG-3 gene and antibodies. A further family is co-owned with the French National Institute of Health and Medical Research (Inserm), a public scientific and technological institute and is licensed to GSK. The remaining patent families are exclusively owned by Prima BioMed. The LAG-3 portfolio provides a broad scope of coverage to both existing and potentially new clinical products. 36   PRIMA  BIOMED  
9. SWOT Analysis Strengths
Strong patent position Strong management and human therapy development expertise Vast expertise in fast growing area of immuno-oncology Sufficient cash position to finance its clinical programs & potential outstanding milestone Partnerships with big pharma companies validate technology Weaknesses
Operating losses cumulating year-on-year Delay pipeline development Profitable Partnerships and license agreements with large pharmaceuticals Ongoing strong growth of immunotherapy products Uncertainty about the outcome of clinical trial of the products Higher level of expenditure than budgeted PRIMA  BIOMED   37  
For the first half year ended 31 December 2014, Prima BioMed reported a net loss of AUD 6.7 million compared to a net loss of AUD 8.4 million in the same period last year. During the six months ended December 31 2014, gross R&D expenditures totalled AUD 4.7 million (2013 –AUD 5.7 million). Total cash at the end of the period amounted to AUD 5.7 million. On October 2nd an agreement was made with Bergen Global Opportunity Fund to provide an equity drawdown facility of up to USD 34.9 million and a USD 2.5 million convertible note. As at December 31 2014, the total funds received from Bergen was USD 3.675 million. During the terms of the agreement, Bergen will invest up to USD 700k per month in Prima BioMed's equity over a period of 24 months with the option to increase each of the monthly tranches to an amount not exceeding USD 1.5 million by mutual consent of Bergen and Prima BioMed. On December 12, Prima BioMed acquired 100% of the issued share capital of Immutep. The estimated fair value of the purchase is calculated as follows: • Deferred consideration • Fair value of shares issued • Fair value of warrants issued • Total purchase consideration 38   PRIMA  BIOMED  
Financial Summary (AUD mln)
Profit & Loss Statement
Dec 31 2014A Dec 31 2013A
For half year ended December 2013
(6 mnths)
(6 mnths)
Revenues
Expenses
R&D Costs
Tax Credits
General & administrative expenses
Finance costs
Income (loss) before income taxes
Income Taxes
Net Loss (Income)
Source: Company filings Consolidated statement of cash flows
Dec 31 2014A
Dec 31 2013A
(6 months)
(6 months)
Cashflow from operating activities
Cash flow from investing activities
(15.842)
(0.047))
Cash flow from financing activities
Cash and cash equivalents at
beginning of the period
Net change in cash and cash
equivalents
Cash and cash equivalents at the
end of the period
PRIMA  BIOMED   39  
We value Prima BioMed at AUD 150 million using a risk-adjusted NPV valuation. This is valuing the potential of the CVac clinical programs in ovarian and pancreatic cancer as well as the IMP321 clinical program acquired from Immutep. We choose not to value Prima Biomeds preclinical pipeline and only to make a valuation of its clinical pipeline. We feel that potential value of its preclinical pipeline offers an additional upside potential. We estimate that CVac could be launched in 2019 and generate peak sales of USD 350 million in second line ovarian cancer. This assumes that the therapy confers a medically meaningful survival benefit is priced at USD 50,000 per course of treatment and gains 25% market penetration. This is based on the number of patients that die from ovarian cancer in the US, with 75% of ovarian cancers in second-line setting are platinum-sensitive. On a similar basis with 10% market penetration, we estimate that CVac could achieve peak sales of USD 400 million in pancreatic cancer after being launched in 2022. Discount
NPV Value
Probability Adj NPV
Per Share
(AUD mln) of succes
(AUD mln)
CVac Ovarian
CVac Pancreatic 15%
IMP321 (various 15%
programs)

40   PRIMA  BIOMED  
With the start of several Phase II clinical trial we estimate a probability of success of 25% till market launch. This is based on an independent survey executed by BioMedTracker and BIO in 20121. See also the graph below. 1 Clinical Development Success Rates for Investigational Drugs, Pharma CI2012 PRIMA  BIOMED   41  
Adjuvant:
A substance sometimes included in a vaccine formulation to
enhance or modify the immune-stimulating properties of a
Agonist:
Substance that binds to a receptor and triggers a response in
the cell. An agonist is the opposite of an antagonist in the
sense that while an antagonist also binds to the receptor, the
antagonist fails to activate the receptor and actually blocks it
from activation by agonists
Antagonist:
Substance that inhibits the normal physiological function of a
receptor. Many drugs work by blocking the action of
endogenous receptor agonists such as hormones and
Antigens:
Foreign substances in the body that are capable of causing
disease.
Small white blood cells that help the body defend itself
against infection. These cells are produced in bone marrow
and develop into plasma cells that produce antibodies. Also
known as B-lymphocytes
class of diseases or disorders characterized by uncontrolled
division of cells and the ability of these cells to invade other
tissues, either by direct growth into adjacent tissue through
invasion or by implantation into distant sites by metastasis
Cytokines:
soluble proteinaceous substances produced by a wide variety
of cell types, and are critical to the functioning of both innate
and adaptive immune responses. Apart from their role in the
development and functioning of the immune system, and their
aberrant modes of secretion in a variety of immunological,
inflammatory and infectious diseases, cytokines are also
involved in several developmental processes during human
Dendritic cells:
Immune cells that form part of the mammal immune system.
42   PRIMA  BIOMED  
They are present at a low frequency in those tissues which are
in contact with the environment: in the skin (where they are
often called Langerhans cells) and the lining of nose, lungs,
stomach and intestines
European Medicines Evaluation Agency, coordinates the
procedures for application, approval and registration of new
drugs in the European Union
Food and Drug Administration, the government agency that
regulates drug licenses in the US
Immune response: The reaction of the immune system to foreign substances
Immune system:
The complex system (network of specialized cells and organs)
in the body responsible for fighting disease. Its primary
function is to identify foreign substances in the body
(bacteria, viruses, fungi or parasites) and develop a defense
against them. This defense is known as the immune response.
It involves production of protein molecules called antibodies
to eliminate foreign organisms invading the body
Immunity:
Natural or acquired resistance provided by the immune
system to a specific disease. Immunity may be partial or
complete, specific or non-specific, long lasting or temporary.
Immunity is indicated by the presence of antibodies in the
blood and can usually be determined with a laboratory test
The process by which a person or animal becomes protected
against a disease; the process of inducing immunity by
administering an antigen (vaccine) to allow the immune
system to prevent infection or illness when it subsequently
encounters the infectious agent. This term is often used
interchangeably with vaccination or inoculation.
Immunogen:
A substance capable of provoking an immune response. Also
called an antigen.
Immunogenicity: The ability of an antigen or vaccine to stimulate immune
responses
Metastasis:
the spread of cancer from its primary site to other places in
PRIMA  BIOMED   43  
the body (e.g., brain, liver).
Oncogene:
a modified gene that increases the malignancy of a tumor cell.
Some oncogenes, usually involved in early stages of cancer
development, increase the chance that a normal cell develops
into a tumor cell, possibly resulting in cancer
Abnormal growth of tissue. This growth can be either
malignant or benign
Vaccine:
A preparation that stimulates an immune response that can
prevent an infection or create resistance to an infection
44   PRIMA  BIOMED  
Analyst: Marcel Wijma MSc Marcel Wijma, Chief Research Officer and managing partner, has a longstanding history in financial biotech research. After selling Van Leeuwenhoeck Research (VLR) to SNS Securities in 2006, he established an award winning analyst team in biotech/life sciences at SNS Securities. In 2009, Marcel was awarded by Financial Times/Starmine as being one of the Top-3 biotech analysts in Europe. Later that year, Marcel purchased VLR from SNS Securities after which the company was reconstituted. At VLR, he leads the professional VLR research organisation, which is augmented by selected external financial researchers with a specialisation in Life Sciences. Mr. Wijma has a Masters degree in Financial Economics from Erasmus University in Rotterdam. Disclaimer The facts stated and the opinion and prognoses given in this publication are based on data and information considered to be reliable and have been carefully worked into our analyses and prognoses. However, no guarantee can be given as to their fairness, accuracy or completeness. Van Leeuwenhoeck Institute. does not accept responsibility or liability in any way in respect to the information stated herein. Van Leeuwenhoeck Institute does not hold or have positions in securities as referred to in this publication. The views expressed in this publication accurately reflect the analyst's personal views on the subject securities or issuer. Neither the analyst's compensation nor the compensation received by Van Leeuwenhoeck Institute is in any way related to the specific recommendations or views contained in this publication. Any investments referred to herein may involve significant risk, are not necessarily available in all jurisdictions, may be illiquid and may not be suitable for all investors. The value of, or income from, any investments referred to herein may fluctuate and/or be affected by changes in exchange rates. Past performances are not indicative for future results. Investors should make their own investment decisions without relying on this publication. Only investors with sufficient knowledge and experience in financial matters to evaluate the merits and risks should consider an investment in any issuer or market discussed herein and other persons should not take any action on the basis of this publication. Information, opinions or recommendations contained in this publication are submitted solely for advisory and information purposes. The information used and statements of fact made, have been obtained from sources considered reliable, but we neither guarantee nor represent the completeness or accuracy. Such information and the opinions expressed are subject to change without notice. This publication is not intended as an offering or a solicitation of an offer to buy or sell the securities mentioned or discussed. Van Leeuwenhoeck Institute does not accept any equity compensation. Reports are performed on behalf of the public, and are not a service to any company. The analysts are responsible only to the public, and are paid in advance to eliminate pecuniary interests and insure independence. Periodic Research reports and research notes on this Company are available at our web site: www.leeuwenhoeck.com Copyright 2015 by Van Leeuwenhoeck Institute Inc. PRIMA  BIOMED   45  

Source: http://prima-biomed.de/investor/analyst_reports_pdf/ReportPRRFebruary.pdf