Celgene’s Acquisition of Juno Has Sent This Mostly Unknown Small Cap CAR-T Stock Flying January 23, 2018 - - ORGS is an Overlooked Cell Therapy Manufacturer and Developer Working with Major Biotech Companies like Servier, CRISPR (CRSP), and Adaptimmune (ADAP), Among Others- Celgene-Juno and Gilead-Kite Deals Demonstrate Just how Valuable Cell Therapies like CAR T-cells will Become, and Manufacturing Plays a Major Role in these Complex New Products, Accounting for 20-40% of Their Sale Price- ORGS is an Ancillary Trade on this Coming Boom in Cell Therapies. Their Revenue is Growing at an Impressive Rate, and Orgenesis Gets Little or no Credit for Potentially Revolutionary In-house R&D Program. As Investors Realize this and the Validation Behind Orgenesis' Manufacturing, ORGS could Rise by 100-1200% Oncology-focused cell therapy companies have been one of the hottest investments of the last five years, culminating in Gilead Sciences' (GILD) $12 bln purchase of Kite Pharma (KITE), and now the $9 bln purchase of Juno Therapeutics (NASDAQ: JUNO) by Celgene Corp (NASDAQ: CELG). One of the most overlooked - and possibly profitable - investments lies in ancillary cell therapy companies, like Orgenesis (ORGS). ORGS has yet to receive the same level of attention as its larger counterparts, but that could be about to change as the company's cell therapy manufacturing business is booming, cell therapies, including CAR-T are about to take off, and the company has already signed multiple high-profile drug developers as partners. Based on a comparison to the recent CELG-JUNO deal and considering how their partners are valued by the public markets today, ORGS could have 12X of upside as the cell therapy industry emerges in the coming years. Partnerships With Big Companies Validate Orgenesis Publicly traded Orgenesis has two sides to their business: MaSTherCell provides contract development and manufacturing (CDMO) services to pharma and biotech companies developing or selling cell-based therapies. The company's R&D program meanwhile centers on Autologous Insulin Producing (AIP) cells that can transform a patient's own liver cell into a functional insulin-producing cell (like is normally found in the pancreas) designed to provide long-term insulin independence for diabetics. This technology is early, but promising, and in a huge market - diabetes. Cell therapies are therapeutics in which cellular material, often a living cell, is injected into a patient. Historically, the most common types of cell therapies have been for the replacement of mature, functioning cells through blood and platelet transfusions. Now, some the most promising therapies involve equipping immune cells with chimeric antigen receptors (CARs), which enable them to identify, target and destroy cancer cells. These are called CAR-T therapies, and in the next decade these are expected to become a $25 billion industry as they are in some cases proving curative in late-stage cancers. The manufacturing process for these and other cell therapies is far more complex than traditional chemical drugs, like Tylenol, and there are few companies with the specialty and know-how to manufacture this emerging new class of drugs. Orgenesis' MasTHerCell subsidiary allows larger companies to outsource the complicated development and manufacturing of these therapies, for both testing and commercial purposes. MaSTherCell is a revenue-generating business for Orgenesis, and it's growing at a significant clip as the market for cell therapies expands. Revenue for the fiscal year ending November 30, 2016 increased 115% to $6.4 million, from $3.0 million in fiscal 2015. So far in the nine months ended August 31, 2017 the company has already surpassed last year's revenue, with $6.7 mln in sales! Estimating for $2 to $2.5 mln in fourth quarter revenue, Orgenesis could be on track to announce between $8 and $10 mln in fiscal 2017 revenue in the new year, or almost 50% growth from the last 12 months. That kind of expansion won't go overlooked as cell therapies come to the forefront, and the stock could be due for a major move higher based on growth potential and a look at a similar ancillary company. MaSTherCell Manufacturing Business Alone Justifies 12X Of Upside? T-cell therapies, like Yescarta and other CAR-Ts, are expected to become a $25 billion industry by 2030 according to Global Information, Inc., expanding at an annualized growth rate of over 101% during this time. Earlier this year there were over 280 T-cell therapies in development, and all of these developers will need commercial and manufacturing expertise. Orgenesis has already proven they're both trusted and efficient. Their current manufacturing facility is in Belgium, which is why they've signed manufacturing and development agreements with some of the most high-profile companies in Europe. Orgenesis has tremendous validation in the number and caliber of existing customers using MasTherCell. Under a deal signed in June, MaSTherCell will will be responsible for the development and manufacturing of CRISPR Therapeutics AG's (CRSP) CTX101 for use in clinical studies. CRISPR is one of the most respected new gene editing companies to go public, using the new CRSPR technology to cheaply and efficiently alter a patient or cell's genes, and therefore its future. The company is worth almost $1 bln in the public markets. CTX101 is an allogeneic CAR T-cell therapy currently in development for the treatment of CD19 positive malignancies, just like Gilead's YESCARTA (axicabtageneciloleucel). Orgenesis is also working with Servier on the development of a manufacturing platform for allogeneic cell therapies that can be stored and given to any patient regardless of origin, beginning with a CAR-T therapy called UCART-19. This technology was developed by Cellectis S.A. (CLLS), licensed to privately held Servier, and is also partnered with Pfizer (PFE) for commercialization in the United States. Pfizer paid $80 million up front for rights to the drug once approved, and Cellectis is widely respected and now a billion dollar company on the NASDAQ. Other companies using MaSTherCell include Adaptimmune Therapeutics plc (ADAP) and Athersys, Inc (ATHX). Cell therapies are expensive and difficult to produce, and Orgenesis is clearly pulling ahead of the crowd in terms of manufacturing expertise, based on their current partnerships. One way to consider ORGS valuation and upside potential is to consider the theoretical value of the manufacturing for some high-profile CAR T-cell therapies. Juno was just purchased for $9 bln, or about 2-4x Wall Street analyst peak sales estimates of $2-$3bln in 2025, for some of their most advanced drug candidates. Manufacturing of CAR T-cell drugs is expensive and could account for 20 to 40% of their sale price. In other words, $1.5-2.5 billion or more of value from the Celgene-Juno deal can be ascribed to manufacturing alone! That's why cell therapy manufacturing could, in the long-run, be so valuable. The billions in future CAR T-cell therapy sales is also worth billion to their manufacturers, like Orgenesis. At just $100 million in market value today, ORGS has significant upside if they can continue to close high-value partnerships with cell therapy companies. The public companies with whom they're currently partnered or working on their drugs in some capacity are worth $3.5 billion in the aggregate...30% of this, or the hypothetical cost/value of their manufacturing would put ORGS at a $1.2 bln valuation, or 12X today's stock price. AIP Completely Overlooked Cure For Diabetes? Orgenesis' CDMO business is undervalued, but what of their R&D programs? The AIP program converts liver cells into functional insulin producing cells as a potential treatment for diabetes. Utilizing 'cellular trans-differentiation' to transform a patient's own adult liver cell into a fully functional and physiologically glucose-responsive pancreatic-like insulin producing cell, Orgenesis hopes to provide Diabetes patients with long-term insulin independence through a one-time treatment. This is done occasionally today using islet cells, but the outcomes are inconsistent, and it's not a common treatment. Though early in development, these AIPs could provide a lasting, possibly curative approach to diabetes management. The company is on track to begin human testing next year, which could lead to human trial results in 2018. This technology is currently not getting any attention from investors, and with a successful trial, this technology could revolutionize diabetes care. Risks to the ORGS investment thesis include stiff competition from larger companies, like Gilead, that want to bring all of their manufacturing in-house. Orgenesis will probably need to build out a U.S. manufacturing facility in order to be involved in the cell therapy CDMO space in that region, and the company has limited capital available for major new buildouts like this. Smart investors aren't blind to the potential here, and ORGS has started to move higher as cell therapies have come into the spotlight recently. This could be the beginning of a breakout move for the stock. Considering how under-the-radar ORGS still is, and comparably undervalued next to similar companies, this could be worth 100-1200% of its current price within a few year's time. About One Equity Stocks One Equity Stocks is a leading provider of research on publicly traded emerging growth companies. Our team is comprised of sophisticated financial professionals that strive to find the companies and management teams that will outperform the market and deliver investment returns to our subscribers. We are not a licensed broker-dealer and do not publish investment advice and remind readers that investing involves considerable risk. One Equity Stocks encourages all readers to carefully review the SEC filings of any issuers we cover and consult with an investment professional before making any investment decisions. One Equity Stocks is a for-profit business and is usually compensated for coverage of issuers we cover as well as other advisory work we perform. In the case of ORGS, we are reimbursed for actual costs we incur, received 50,000 shares of restricted stock, and anticipate receiving an additional 10,000 restricted shares per month from ORGS for Business Development, Capital Markets, and Research Services. Please contact us at [email protected] for additional information or to subscribe to our intelligence service.
Celgene’s Acquisition of Juno Has Sent This Mostly Unknown Small Cap CAR-T Stock Flying January 23, 2018 - - ORGS is an Overlooked Cell Therapy Manufacturer and Developer Working with Major Biotech Companies like Servier, CRISPR (CRSP), and Adaptimmune (ADAP), Among Others- Celgene-Juno and Gilead-Kite Deals Demonstrate Just how Valuable Cell Therapies like CAR T-cells will Become, and Manufacturing Plays a Major Role in these Complex New Products, Accounting for 20-40% of Their Sale Price- ORGS is an Ancillary Trade on this Coming Boom in Cell Therapies. Their Revenue is Growing at an Impressive Rate, and Orgenesis Gets Little or no Credit for Potentially Revolutionary In-house R&D Program. As Investors Realize this and the Validation Behind Orgenesis' Manufacturing, ORGS could Rise by 100-1200% Oncology-focused cell therapy companies have been one of the hottest investments of the last five years, culminating in Gilead Sciences' (GILD) $12 bln purchase of Kite Pharma (KITE), and now the $9 bln purchase of Juno Therapeutics (NASDAQ: JUNO) by Celgene Corp (NASDAQ: CELG). One of the most overlooked - and possibly profitable - investments lies in ancillary cell therapy companies, like Orgenesis (ORGS). ORGS has yet to receive the same level of attention as its larger counterparts, but that could be about to change as the company's cell therapy manufacturing business is booming, cell therapies, including CAR-T are about to take off, and the company has already signed multiple high-profile drug developers as partners. Based on a comparison to the recent CELG-JUNO deal and considering how their partners are valued by the public markets today, ORGS could have 12X of upside as the cell therapy industry emerges in the coming years. Partnerships With Big Companies Validate Orgenesis Publicly traded Orgenesis has two sides to their business: MaSTherCell provides contract development and manufacturing (CDMO) services to pharma and biotech companies developing or selling cell-based therapies. The company's R&D program meanwhile centers on Autologous Insulin Producing (AIP) cells that can transform a patient's own liver cell into a functional insulin-producing cell (like is normally found in the pancreas) designed to provide long-term insulin independence for diabetics. This technology is early, but promising, and in a huge market - diabetes. Cell therapies are therapeutics in which cellular material, often a living cell, is injected into a patient. Historically, the most common types of cell therapies have been for the replacement of mature, functioning cells through blood and platelet transfusions. Now, some the most promising therapies involve equipping immune cells with chimeric antigen receptors (CARs), which enable them to identify, target and destroy cancer cells. These are called CAR-T therapies, and in the next decade these are expected to become a $25 billion industry as they are in some cases proving curative in late-stage cancers. The manufacturing process for these and other cell therapies is far more complex than traditional chemical drugs, like Tylenol, and there are few companies with the specialty and know-how to manufacture this emerging new class of drugs. Orgenesis' MasTHerCell subsidiary allows larger companies to outsource the complicated development and manufacturing of these therapies, for both testing and commercial purposes. MaSTherCell is a revenue-generating business for Orgenesis, and it's growing at a significant clip as the market for cell therapies expands. Revenue for the fiscal year ending November 30, 2016 increased 115% to $6.4 million, from $3.0 million in fiscal 2015. So far in the nine months ended August 31, 2017 the company has already surpassed last year's revenue, with $6.7 mln in sales! Estimating for $2 to $2.5 mln in fourth quarter revenue, Orgenesis could be on track to announce between $8 and $10 mln in fiscal 2017 revenue in the new year, or almost 50% growth from the last 12 months. That kind of expansion won't go overlooked as cell therapies come to the forefront, and the stock could be due for a major move higher based on growth potential and a look at a similar ancillary company. MaSTherCell Manufacturing Business Alone Justifies 12X Of Upside? T-cell therapies, like Yescarta and other CAR-Ts, are expected to become a $25 billion industry by 2030 according to Global Information, Inc., expanding at an annualized growth rate of over 101% during this time. Earlier this year there were over 280 T-cell therapies in development, and all of these developers will need commercial and manufacturing expertise. Orgenesis has already proven they're both trusted and efficient. Their current manufacturing facility is in Belgium, which is why they've signed manufacturing and development agreements with some of the most high-profile companies in Europe. Orgenesis has tremendous validation in the number and caliber of existing customers using MasTherCell. Under a deal signed in June, MaSTherCell will will be responsible for the development and manufacturing of CRISPR Therapeutics AG's (CRSP) CTX101 for use in clinical studies. CRISPR is one of the most respected new gene editing companies to go public, using the new CRSPR technology to cheaply and efficiently alter a patient or cell's genes, and therefore its future. The company is worth almost $1 bln in the public markets. CTX101 is an allogeneic CAR T-cell therapy currently in development for the treatment of CD19 positive malignancies, just like Gilead's YESCARTA (axicabtageneciloleucel). Orgenesis is also working with Servier on the development of a manufacturing platform for allogeneic cell therapies that can be stored and given to any patient regardless of origin, beginning with a CAR-T therapy called UCART-19. This technology was developed by Cellectis S.A. (CLLS), licensed to privately held Servier, and is also partnered with Pfizer (PFE) for commercialization in the United States. Pfizer paid $80 million up front for rights to the drug once approved, and Cellectis is widely respected and now a billion dollar company on the NASDAQ. Other companies using MaSTherCell include Adaptimmune Therapeutics plc (ADAP) and Athersys, Inc (ATHX). Cell therapies are expensive and difficult to produce, and Orgenesis is clearly pulling ahead of the crowd in terms of manufacturing expertise, based on their current partnerships. One way to consider ORGS valuation and upside potential is to consider the theoretical value of the manufacturing for some high-profile CAR T-cell therapies. Juno was just purchased for $9 bln, or about 2-4x Wall Street analyst peak sales estimates of $2-$3bln in 2025, for some of their most advanced drug candidates. Manufacturing of CAR T-cell drugs is expensive and could account for 20 to 40% of their sale price. In other words, $1.5-2.5 billion or more of value from the Celgene-Juno deal can be ascribed to manufacturing alone! That's why cell therapy manufacturing could, in the long-run, be so valuable. The billions in future CAR T-cell therapy sales is also worth billion to their manufacturers, like Orgenesis. At just $100 million in market value today, ORGS has significant upside if they can continue to close high-value partnerships with cell therapy companies. The public companies with whom they're currently partnered or working on their drugs in some capacity are worth $3.5 billion in the aggregate...30% of this, or the hypothetical cost/value of their manufacturing would put ORGS at a $1.2 bln valuation, or 12X today's stock price. AIP Completely Overlooked Cure For Diabetes? Orgenesis' CDMO business is undervalued, but what of their R&D programs? The AIP program converts liver cells into functional insulin producing cells as a potential treatment for diabetes. Utilizing 'cellular trans-differentiation' to transform a patient's own adult liver cell into a fully functional and physiologically glucose-responsive pancreatic-like insulin producing cell, Orgenesis hopes to provide Diabetes patients with long-term insulin independence through a one-time treatment. This is done occasionally today using islet cells, but the outcomes are inconsistent, and it's not a common treatment. Though early in development, these AIPs could provide a lasting, possibly curative approach to diabetes management. The company is on track to begin human testing next year, which could lead to human trial results in 2018. This technology is currently not getting any attention from investors, and with a successful trial, this technology could revolutionize diabetes care. Risks to the ORGS investment thesis include stiff competition from larger companies, like Gilead, that want to bring all of their manufacturing in-house. Orgenesis will probably need to build out a U.S. manufacturing facility in order to be involved in the cell therapy CDMO space in that region, and the company has limited capital available for major new buildouts like this. Smart investors aren't blind to the potential here, and ORGS has started to move higher as cell therapies have come into the spotlight recently. This could be the beginning of a breakout move for the stock. Considering how under-the-radar ORGS still is, and comparably undervalued next to similar companies, this could be worth 100-1200% of its current price within a few year's time. About One Equity Stocks One Equity Stocks is a leading provider of research on publicly traded emerging growth companies. Our team is comprised of sophisticated financial professionals that strive to find the companies and management teams that will outperform the market and deliver investment returns to our subscribers. We are not a licensed broker-dealer and do not publish investment advice and remind readers that investing involves considerable risk. One Equity Stocks encourages all readers to carefully review the SEC filings of any issuers we cover and consult with an investment professional before making any investment decisions. One Equity Stocks is a for-profit business and is usually compensated for coverage of issuers we cover as well as other advisory work we perform. In the case of ORGS, we are reimbursed for actual costs we incur, received 50,000 shares of restricted stock, and anticipate receiving an additional 10,000 restricted shares per month from ORGS for Business Development, Capital Markets, and Research Services. Please contact us at [email protected] for additional information or to subscribe to our intelligence service.