Is Intensity Therapeutics Inc. IPO a Good Buy?

Read our Advertiser Disclosure.
Contributor, Benzinga
February 13, 2023
$4.40
-0.15[-3.30%]
Last update: 8:18AM (Delayed 15-Minutes)
Get Real Time Here
Open4.550Close4.590
Vol / Avg.3.394K / 60.674KMkt Cap60.321M
Day Range4.550 - 4.76052 Wk Range2.010 - 11.440

Although recent years lay witness to groundbreaking innovations in the biotechnology sector — specifically in the field of oncology — cancer remains a pervasive and devastating disease. Fortunately, Intensity Therapeutics Inc. may offer a compelling solution through its novel therapeutic delivery approach. Specializing in intratumoral immunotherapy or the direct inoculation of immune-stimulating agents into a tumor, Intensity aims to ultimately promote superior health outcomes.

Fundamentally, the discipline of intratumoral immunotherapy holds great promise in the field of oncology. According to research published in the National Library of Medicine, intratumoral immunotherapy offers four main potential advantages: avoiding off-target toxicity, lower-dosage requirements, superior priming of T cells (or a type of white blood cell that represents a component of the immune system) and multi-clonal responses.

However, Intensity notes on its website that contemporary intratumoral methodologies suffer significant leakages of therapeutics. In turn, the contents of cancer-fighting drugs leak into interstitial spaces, resulting in little to no drug dispersion with targeted tumors. In contrast, Intensity uses a proprietary 100% water-based diffusion technology that facilitates full-therapeutic penetration into targeted tumors without leakage vulnerabilities. Therefore, Intensity’s approach results in significant dispersion in impacted tumors.

As compelling as the underlying science is, Intensity’s upcoming public market debut — set for the week beginning Feb. 12, 2023 — features significant challenges. Mainly, they center on the viability concerns of a modestly sized public offering. As well, broader market dynamics impose headwinds on aspirational entities.

Below are key factors to consider before acquiring shares of Intensity Therapeutics.

What Does Intensity Therapeutics Do?

A clinical-stage biotech firm, Intensity Therapeutics specializes in the burgeoning field of intratumoral delivery innovations. This discipline aims to create drug products that kill cancer cells in a manner that enables immune cells to enter and attack tumors throughout the body. Primarily, Intensity’s mission is to meaningfully extend the lives of patients with metastatic cancer while maintaining their quality of life.

Intensity leverages a novel proprietary penetration enhancer platform called DfuseRX. This technology enables therapeutic agents to be injected directly into solid tumors for improved absorption. Once injected, DfuseRX facilitates the dispersion of the underlying therapeutic throughout the tumor and into the cancer cells themselves.

Following dispersion, the process sparks cancer cell death without disruption of the cell membrane. Essentially, this precise mechanism exposes the immune system to the cancer cell’s blueprints, empowering the production of targeted cancer-fighting antigens. Even more compelling, an exploratory analysis of Intensity’s Phase 1/2 trial indicated a significant increase in patient survivability.

A substantial advantage that Intensity Therapeutics enjoys centers on a lack of competition. According to the National Library of Medicine, “out of the 130 recently completed and ongoing neoadjuvant [a first-step therapy prior to the main treatment] immunotherapy trials, only 24 utilize intratumoral immunotherapy.”

According to the publication Fierce Biotech, “Intensity’s only asset is INT230-6, which consists of two approved anti-cancer cytotoxic agents, cisplatin and vinblastine sulfate. A phase 1/2 trial in a range of cancers was launched in 2017, with data now being finalized ahead of a readout. There’s also an ongoing phase 2 trial of the drug as a treatment prior to surgery in early-stage breast cancer.”

In addition, some of the proceeds from Intensity’s public market debut “will be used to push INT230-6 into a phase 3 trial for sarcoma, as well as develop a second candidate in INT33X, which is currently being tested in mice.”

When is the Intensity Therapeutics IPO Date?

From the latest information, Intensity Therapeutics will launch its initial public offering (IPO) — or the first time a private company distributes its equity shares to retail (public) investors — on Feb. 14, 2023. Shares will trade on the Nasdaq exchange under the ticker symbol INTS.

As mentioned by Renaissance Capital, Intensity plans to raise $8 million through the distribution of 1.8 million shares at a price of $4.50 each. Notably, insiders plan to purchase $3 million worth of shares in the offering, accounting for 31% of the deal.

Originally, Intensity filed for an IPO in October 2021, seeking to raise $15 million through the offering of 1.5 million shares at a price ranging between $9 to $11. Later in December, the company revised terms to raise the same amount by offering 2.1 million shares at a range of $6 to $8.

At the time, Roth Capital and The Benchmark Company were set to be the joint bookrunners for the IPO. Currently, only The Benchmark Company is scheduled to be the bookrunner on the deal.

Intensity will enter the capital market at a more favorable time than in 2022 when a combination of geopolitical flashpoints and skyrocketing inflation relative to historical norms sent investors scrambling. While the Federal Reserve’s aggressive interest rate hiking campaign to correct the monetary excesses associated with the government’s initial COVID-19 response should theoretically cool inflation, it also contributed to investor jitters.

Currently, INTS stock enjoys broader tailwinds; namely, a benchmark S&P 500 index that’s trading in positive territory for the year and resurgent interest in IPOs, particularly in the biotech ecosystem.

Still, interested participants of INTS stock should note the blowout January jobs report. In addition, China’s recent economic reopening presents a worrying framework as the combination of these events implies greater consumption of critical resources, leading to heightened demand (i.e., accelerating prices).

It wouldn’t be out of the question for the Fed to respond with an even more hawkish monetary policy. The associated rise in borrowing costs may negatively impact risk-on investments like INTS stock.

What Analysts Are Saying About Intensity Therapeutics IPO

As one of the more modest IPOs — with a stock float amounting to $13.7 million — no analyst has weighed in on Intensity’s public market debut. Primarily, then, prospective participants will likely focus on the biotech firm’s clinical progress.

In November last year, Intensity revealed that its INT230-6 demonstrated increased survival as either a monotherapy or in combination with pembrolizumab — a Merck & Co Inc. (NYSE: MRK) cancer drug marketed under the brand name Keytruda — in patients with relapsed,  refractory and metastatic solid tumor cancers.

Intensity revealed that research in conjunction with the Ottawa Hospital and the Ontario Institute for Cancer Research reported that INT230-6 demonstrated tumor necrosis (death of cells in an organ or tissue) and immune activation in early-stage breast cancers.

Undeniably encouraging, the main concerns associated with INTS stock focus on the viability of risky and aspirational biotech enterprises. As Intensity disclosed in its Form S-1 filing with the U.S. Securities and Exchange Commission (SEC), the company features a limited operating history. As of the date of the filing, the biotech outfit did not generate any revenue from product sales.

Also worth noting for prospective investors of INTS stock is that the underlying enterprise incurred significant operating losses since inception. More critically, management anticipates that it will incur continued losses for the foreseeable future.

Given the macroeconomic environment, market participants should note perhaps the most critical warning from Intensity’s S-1 filing: “Even if we consummate this offering, we will need to raise substantial additional funding. If we are unable to raise capital when needed, we would be forced to delay, reduce or eliminate some or all of our product development programs or commercialization efforts.”

Intensity Therapeutics Financial History

Easily one of the biggest challenges associated with the INTS stock IPO centers on the financials. As Intensity’s management team declared, it represents a pre-revenue enterprise. Therefore, the pace of its operational losses may make some investors uncomfortable.

For the full year 2019, Intensity posted an operating loss of $5.675 million. In the next year, this metric expanded unfavorably to $6.22 million. According to the most recently amended Form S-1 filing, operational losses in 2021 reached slightly greater than $8 million. Ultimately, for that year, the net loss came out to $7.895 million.

The balance sheet presents some risks. On Dec. 31, 2020, Intensity posted a cash and cash equivalents balance of $9.316 million. However, one year later, the biotech incurred a cash drain, posting only $4.539 million. Plus, when deducting liabilities from assets, Intensity shows a stockholders’ deficiency of $8.684 million.

Intensity Therapeutics Potential

Given the rough year that the global capital markets endured in 2022, it’s possible that sentiment for risk-on ventures may improve in 2023. For instance, both stocks and cryptocurrencies posted a strong performance since their respective January openers.

At the same time, Intensity, while commanding significant scientific acumen, sorely lacks in the fiscal stability department. Even if that arena were shored up, the harsh reality is that the clinical-stage biotech industry incurs significant risks. Therefore, investors interested in INTS stock should only use limited funds earmarked for extreme speculation.

Where to Buy Intensity Therapeutics IPO Stock

If you want to participate in Intensity’s IPO, you’ll need to know how to buy stocks. But before you take that step, you must sign up for a brokerage account. Below is a list of the best brokers to consider.

INTS Restrictions for Retail Investors

Review the Financial Industry Regulatory Authority (FINRA) rules on restricted persons before participating in an IPO. Don’t engage if you have privileged information.

INTS Pre-IPO

As a modestly sized offering, no pre-IPO opportunity exists for INTS stock. However, investors interested in wagering on companies on the ground floor of their public transition can open an account with ClickIPO.com.

About Joshua Enomoto

His distinct writing style of distilling convoluted data into relatable and compelling narratives has earned him recognition among several investment-related publications.