AEMD: Expect Focus on Oncology Studies; Cost Containment Efforts
By M. Marin
NASDAQ:AEMD
READ THE FULL AEMD RESEARCH REPORT
Expect no disruption from management change; increased emphasis on studying Hemopurifier® in oncology likely…
Aethlon Medical (NASDAQ:AEMD) appointed CFO James Frakes as interim CEO. We expect no disruption as a result of the management change – Mr. Frakes has been with Aethlon since 2008 & knows the company well, in our view. Moreover, including Aethlon, he has had 27 years of CFO level financial responsibility with publicly traded companies. We anticipate increased emphasis on studying the Hemopurifier® in the oncology area, as well as potential cost containment measures when possible, are likely.
Mr. Frakes, who was also appointed as a member of the company's board, will continue his responsibilities as CFO. In addition, Guy Cipriani has been named as the company's Chief Operating Officer. He had been Aethlon’s Chief Business Officer prior to assuming the COO role. Mr. Cipriani has resigned from the Aethlon board. We do not anticipate major changes as a result of this management shift, although we believe the company is likely to emphasize its clinical efforts in the field of oncology.
… and potential cost containment measures when possible…
Mr. Frakes has been with Aethlon since January 2008 and therefore knows the company well, in our view. Moreover, including his role at Aethlon, he has had 27 years of CFO level financial responsibility with publicly traded companies, as noted. We do not anticipate a major shift in strategy as a result of this management change, as noted, other than likely increased emphasis on studying the Hemopurifier® in the oncology area and potential cost containment efforts when possible.
Expect cash balance, lowering costs where possible, plus accessing ATM funding will enable company to continue moving Hemopurifier forward towards potential regulatory approval, commercialization
We believe lowering costs where possible, plus accessing funding, will enable the company to continue moving the Hemopurifier forward in clinical studies towards potential regulatory approval and commercialization. Under James Frakes’ leadership as CFO, the company put in place an ATM (At The Market offering) to enhance its financial flexibility. AEMD believes its cash balance is sufficient to fund operations for at least a year. We believe lowering costs where possible, plus accessing ATM funding, will enable the company to continue moving the Hemopurifier forward in clinical studies towards potential regulatory approval and commercialization. If Aethlon can demonstrate the Hemopurifier’s ability to improve outcomes of cancer patients suffering from a variety of different cancer types, we would anticipate strong commercial prospects for the device.
… majority of patients treated with checkpoint inhibitors do not respond; studying whether Hemopurifier with checkpoint inhibitors can improve overall patient outcomes
The company recently received clearance from the Drug Controller General of India (DCGI), which is India’s central drug authority, to conduct a phase 1 safety, feasibility and dose-finding trial of the Hemopurifier® in patients with solid tumors who have stable or progressive disease during anti-PD-1 monotherapy treatment such as Keytruda® or Opdivo®. PD-1, or Programmed Cell Death Protein 1, is a protein found on the cell surface that plays a role in inhibiting immune responses. Treatment such as Keytruda®, a type of immunotherapy, helps to block the PD-1 pathway to prevent cancer cells from hiding and, in turn, help the immune system work. While Keytruda® and other anti-PD-1 monotherapy treatments represent a substantial advance in cancer treatment, with certain tumor types it does not work on the majority of cancer patients.
Checkpoint inhibitors such as Keytruda have been used to treat 25+ different types of cancer. By launching a basket oncology trial to study the impact of the Hemopurifier on a variety of cancerous tumors, AEMD believes it can generate data to support the Hemopurifier’s ability to improve outcomes, when combined with checkpoint inhibitor treatment, in multiple tumor types where cancer associated extracellular vesicles may promote immune suppression and resistance to anti-PD-1 antibodies. Given the Hemopurifier’s demonstrated ability to remove exosomes, management believes the device can be used to affect improved outcomes in a number of cancers.
Moreover, by focusing on multiple cancers, the company has also expanded the opportunities for patient enrollment, as well as for building a database to support regulatory approval. By including both Keytruda and Opdivo can also facilitate patient enrollments.
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.
