Cesca Therapeutics Inc KOOL is poised to make much headway with its automated CAR-T manufacturing platform CAR-TXpress, according to H.C. Wainwright.
CAR-T-cell therapy is a method of treating cancer by using a patient's immune system cells — T cells — which are then modified by adding a gene in the lab for a special chimeric antigen receptor, or CAR, to attack cancer cells. CAR binds to a certain protein present in the patient's cancer cell.
The Analyst
Analyst Swayampakula Ramakanth initiated coverage of Cesca with a Buy and $1.50 price target.
The Thesis
Cesca's CAR-TXpress is likely to address the factors that are behind the high production costs of CAR-T cells, which could impede further advancements in CAR-T research and adoption, Ramakanth said in a Wednesday note.
The production costs are $100,000 per patient, the analyst said, naming five reasons for the high cost:
- Insufficient starting T-cell material.
- Labor- and time-intensive processing steps.
- Expensive reagents and machinery.
- Earge clean room footprints.
- Complicated c-GMP compliance.
CAR-T therapies have a market opportunity of $8.5 billion by 2028, up from $15 million in 2017, according to H.C. Wainwright.
Modular automation — a feature of CAR-TXpress — could be a game-changer, Ramakanth said.
"Currently, we project CAR-TXpress products to generate revenue of $548,000 in 2018, growing to $34 million by 2030."
H.C. Wainwright projects opportunity for the company in the contract research development manufacturing organization market; Cesca has signed an exclusive license agreement in China and is likely to expand in the U.S., Ramakanth said.
The Price Action
Cesca shares were down 1.87 percent at 53 cents at the time of publication Wednesday afternoon.
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