Thursday, January 4, 2024
HomeValue InvestingClark Street Value: AlloVir: Another Broken Biotech

Clark Street Value: AlloVir: Another Broken Biotech

AlloVir (ALVR) (~$74MM market cap) is clinical-stage biotech focused on cell therapy to treat viral diseases. On 12/22/23, AlloVir paused their Phase 3 studies for Posoleucel after advisors concluded the studies were unlikely to meet their primary endpoints.  Alongside the announcement, the company announced, “we will immediately shift our focus to preserve our substantial remaining capital, review our pipeline, and assess strategic options.”  AlloVir does have 3 additional pipeline assets:

About AlloVir’s Earlier Stage Virus-Specific T cell Pipeline

Adult Kidney Transplantation

AlloVir has earlier reported the results of its completed Phase 2 randomized, placebo-controlled trial evaluating posoleucel for the treatment of BKV infection in adult kidney transplant patients. After 24 weeks of treatment, 39% of patients receiving posoleucel experienced a ≥1-log viral load reduction, compared to 14% of patients receiving placebo.

Acute Respiratory Infection

The company has completed Part A of a randomized, placebo-controlled Phase 1b/2a trial with ALVR106 in 14 stem cell or solid organ transplant patients. ALVR106 is an investigational allogeneic, off-the-shelf, multi-virus-specific VST therapy candidate designed to target diseases caused by human metapneumovirus (hMPV), influenza, parainfluenza virus (PIV) and respiratory syncytial virus (RSV). Data has been accepted for presentation at a scientific conference in the first quarter of 2024.

Chronic Hepatitis B Infection

ALVR107 is an investigational allogeneic, off-the-shelf VST therapy designed to target hepatitis B virus (HBV)-infected cells and potentially cure patients with chronic HBV infection. Preclinical and IND-enabling studies support the advancement of ALVR107 into a clinical proof of concept study as a next step.

Some of these might be worth something, or not.  The company, unfortunately, didn’t give us current cash or formally announce a reduction in workforce (but if you check LinkedIn, many of their employees are “looking for work”).  My back of the envelope math:

Someone mentioned to me we should hope the “follow Tang” strategy continues into 2024, he’s not on the shareholder registry here (yet), but coming up with a similar offer to what he’s been throwing around, I get something like $0.83/share in cash plus a CVR for any legacy asset proceeds.  There is a good amount of cash burn risk here since we don’t have much guidance from management, but the time between strategic alts announcements and deal announcements seems to be shortening in these broken biotechs.  A poorly thought out reverse merger is always a concern too, however there are some real shareholders here, hopefully they provide some sanity.

Disclosure: I own shares of ALVR



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