SPY397.37+3.48 0.88%
DIA321.28+1.89 0.59%
IXIC11,434.74+170.29 1.51%

BIOAF: Collaboration Arrangement with Janssen

By John Vandermosten, CFA OTC:BIOAF READ THE FULL BIOAF RESEARCH REPORT

Benzinga · 05/01/2022 06:21

By John Vandermosten, CFA

OTC:BIOAF

READ THE FULL BIOAF RESEARCH REPORT

On April 11th, Bioasis Technologies Inc. (OTC:BIOAF) announced a research collaboration with Janssen Pharmaceuticals, a subsidiary of Johnson & Johnson (NYSE:JNJ). As part of the deal, Bioasis will provide access to its xB3 platform to Janssen in order for the latter to research, develop and commercialize new products. Few details were provided regarding the arrangement; however, any intellectual property generated from the work will be available to Bioasis. Representatives from both companies will have the opportunity for regular project team meetings to remain aligned with the research plan negotiated as part the agreement. The financial structure is a cost reimbursement plus margin arrangement with timing of the work to follow the research plan.

Ladenburg Thalmann Enlisted

During its Annual General Meeting (AGM) last November, Bioasis elected to evaluate strategic alternatives with the help of Ladenburg Thalmann. Alternatives that may be pursued include potential accretive merger or acquisition opportunities and future financings. Since the announcement the plan with Ladenburg has proceeded and Bioasis management is actively reviewing opportunities; however, there are no events yet worthy of a press release. The company is also working with Shadow Lake Group which serves as its business development advisor to identify new business opportunities and partnering. Other strategic efforts by Bioasis include the execution of two outstanding Material Transfer Agreements (MTAs), further draws on the Lind agreement or transactions with partners.

Upcoming Milestones

Below are recent and anticipated milestones:

➢ xB3-007 glucocerebrosidase enzyme replacement therapy (ERT), BBB data – 1H:22

➢ xB3-009 (Progranulin) BBB data – 1H:22

➢ $200,000 non-brokered private placement – February 2022

Attendance at the 5th Annual Neuroscience Innovation Forum – March 2022

➢ Filing of FY:22 financials – mid-June 2022

➢ IND preparation for xB3-007 – 2022

➢ IND preparation for xB3-003 – 2022

➢ Additional research agreements with partners related to signed MTA – 2022

Additional Capital Raised

On February 17, 2022 Bioasis announced that it had raised $200,000 in a non-brokered private placement, issuing 770,000 common shares to an arm's length investor for $0.26 per share. The common shares issued pursuant to the private placement are subject to a four month hold period in accordance with applicable securities laws.

Summary

Bioasis shared a welcome surprise with investors with its Janssen Biotech collaboration deal. The agreement will provide xB3 to Janssen for development purposes. Bioasis will conduct the work on behalf of Janssen in a cost plus type arrangement. While expected timing was not disclosed, the parties have developed a research plan which, if successful could lead to additional work. Bioasis is also considering strategic alternatives and has reviewed some potential opportunities with several of its partners. However, no material decisions have been made.

Bioasis offers a broad portfolio built on its xB3 technology platform that can be developed both internally and with partners for many therapies demonstrating brain activity. While transportation, COVID and material availability related issues have delayed work, we anticipate a slowdown to the company's timeline and one dependent on partner capacity. We anticipate parallel development of several xB3 compounds that will enter the clinic over the next several years. Two MTA's that were signed earlier in 2021 may yield additional agreements (likely with associated upfront payments) to add to Bioasis' pipeline. We maintain our valuation of $0.60 per share.

SUBSCRIBE TO ZACKS SMALL CAP RESEARCH to receive our articles and reports emailed directly to you each morning. Please visit our website for additional information on Zacks SCR. 

DISCLOSURE: Zacks SCR has received compensation from the issuer directly, from an investment manager, or from an investor relations consulting firm, engaged by the issuer, for providing research coverage for a period of no less than one year. Research articles, as seen here, are part of the service Zacks SCR provides and Zacks SCR receives quarterly payments totaling a maximum fee of up to $40,000 annually for these services provided to or regarding the issuer. Full Disclaimer HERE.

________________________

1. Source: January 2022 Corporate Slide Deck