Categories Analysis, Health Care

Is Altimmune (ALT) stock a buy right now?

A lot of stocks in the biotech space have skyrocketed this year after their announcements and advances in finding a vaccine or in the treatment of COVID-19. While these companies are yet to reach the final stage of the clinical trials, the market has already started rewarding a few of them. And the notable companies (excluding the pharma giants) in this space include Moderna (NASDAQ: MRNA), Novavax (NASDAQ: NVAX), Inovio (NASDAQ: INO), Vaxart (NASDAQ: VXRT) and Altimmune (NASDAQ: ALT). Let’s see in detail how Altimmmune is performing in this area.

Overview

Altimmune, which was founded in 1997, is a clinical-stage biopharmaceutical company focused on developing treatments for liver disease, immune-modulating therapies, and vaccines. The firm’s diverse pipeline includes proprietary intranasal vaccines for COVID-19 (AdCOVID), anthrax (NasoShield) and influenza (NasoVAX); an intranasal immune modulating therapeutic for COVID-19 (T-COVID), and next generation peptide therapeutics for NASH (ALT-801) and chronic hepatitis B (HepTcell).

Q2 results

The Gaithersburg, Maryland-based firm’s net loss For the second quarter ended June 30, 2020, quadrupled to $16.78 million from the year-ago quarter, driven primarily by higher expenses. Revenue more than halved to $0.72 million in the second quarter. Operating expenses more than tripled in the quarter as a result of higher R&D expenses.

Liquidity and capital resources

Altimmune has not generated any revenues from the sale of any products and has never reported profitability since its inception. In addition, the company has not generated positive cash flows from operations.

Also read: Novavax (NVAX) stock tumbles despite beating bottom line estimates in Q2

The sources of revenue have consisted of revenues under its contract with BARDA for the development of NasoShield and to a lesser degree from other licensing arrangements. In July 2016, Altimmune signed a five-year contract with BARDA, which has a total value of up to $133.7 million. This is used to fund the clinical development of NasoShield.

Cash and short-term investments balance stood at $80 million at the end of second quarter. With the additional cash receipts, Altimmune has more than $200 million of cash and investments on hand and believes to advance its pipeline for at least the next two years. The major portion of this cash will be used to scale-up the manufacturing of both AdCOVID and T-COVID.

Pipeline

  • ALT-801, which treats the non-alcoholic steatohepatitis (NASH) is advancing into Phase 1 development
  • HepTcell, the chronic Hepatitis B treating drug candidate is advancing into Phase 2 development
  • ALT-702. the drug candidate which treats solid tumors is completing the preclinical dataset
  • AdCOVID, an intranasal vaccine designed to protect COVID-19, Phase 1 trial targeted for Q4 2020
  • NasoShield, an intranasal vaccine to protect from Anthrax, funded by BARDA, is in Phase 1b and data targeted for 2H 2020
  • NasoVAX, another intranasal vaccine to treat influenza, is ready for Phase 2b
  • T-COVID, an intranasal therapeutic for the treatment of COVID-19, Phase 1/2 trial to start soon

Final verdict

ALT stock had skyrocketed about 1100% so far this year and 440% in the last three months. The companies, which come out first with a vaccine or treatment for COVID-19, are expected to earn in billions. Apart from the giants like Gilead Sciences (NASDAQ: GILD), there are small companies that have been advancing in this arena. While the small-cap biotech stocks have grown exponentially this year, investors can wait for more data to come from Altimmune and then take a decision.

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DISCLAIMER: The article does not necessarily imply the views of AlphaStreet, and contains opinions of the author alone.

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