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Bio-Path Shares are Attractive now

By Grant Zeng, CFA

Pipeline Expanded by New Indications of Liposomal Grb-2

Recently, Bio-Path Holdings (OTC Markets:BPTH) announced that it is initiating development of its lead cancer drug BP-100-1.01 (Liposomal Grb-2) to treat triple negative breast cancer (TNBC) and inflammatory breast cancer (IBC), two cancers characterized by formation of aggressive tumors and relatively high mortality rates.

Liposomal Grb-2 (L-Grb-2) is the Company’s lead drug candidate currently in a Phase I clinical trial. L-Grb-2 is a liposomal delivered antisense cancer drug that targets an multibillion dollar annual market for Chronic Myelogenous Leukemia (CML), Acute Myeloid Leukemia (AML), Acute Lymphoblastic Leukemia (ALL), and Myelodysplastic Syndrome (MDS).

Grb-2 (growth factor-bound protein-2) is an adaptor protein which is essential to cancer cell signaling because it is utilized by oncogenic tyrosine kinases to induce cancer progression. Suppressing the function or expression of Grb-2 should interrupt its vital signaling function and have a therapeutic application in cancer. L-Grb-2 is a neutral-charge, liposome-incorporated antisense drug substance designed to inhibit Grb-2 expression.




We think the development of Liposomal Grb-2 for the treatment of TNBC and IBC is a major milestone for Bio-Path that has the opportunity to produce substantial value for the Company. Successful development of these applications will be of great benefit to TNBC and IBC patients. Further, the treatment goal for tumor inhibition and reduction in a pre-operative setting provides a potential pathway for rapid approval by the FDA of Liposomal Grb-2, while the longer term effects of controlling or eliminating metastasis will build long term use of our drug.

The new development of L-Grb-2 also expands Bio-Path’s pipeline.

Market for TNBC and IBC is Rather Large

Triple negative breast cancer (TNBC) tumors do not express estrogen receptors, progesterone receptors, and low HER2. These negative results mean that the growth of the cancer is not supported by the hormones estrogen and progesterone, or by the presence of too many HER2 receptors. Therefore, TNBC does not respond to hormonal therapy or therapies that target HER2 receptors. In addition, TNBC tumors are very aggressive. Approximately 15 to 20 percent of breast cancers are triple-negative.

Inflammatory breast cancer (IBC) is a rare and very aggressive disease in which cancer cells block lymph vessels in the skin of the breast. This type of breast cancer is called “inflammatory” because the breast often looks swollen and red, or “inflamed.” IBC accounts for two to five percent of all breast cancers. IBC tumors are very aggressive and are frequently hormone receptor negative, which means hormone therapies may not be effective. Five year survival rate for IBC is 40 percent versus 87 percent for all breast cancers combined, making IBC a priority area for development of new treatments.

The combined market for TNBC and IBC is very large in our view due to the huge market for breast cancer in our view. Together with the CML, AML and MDS, L-Grb-2 is targeting a multibillion dollar market.

In addition to CML, L-Grb-2 also targets AML and MDS as well as the TNBC and IBC, each has a significant market. 



Valuation is Attractive

We are moving to Buy rating on Bio-Path Holdings Inc. from Neutral. Our new twelve-month price target is $1.00 per share.

Our call is based on recent progress the Company has made and current valuation of the Company’s shares.

We believe Bio-Path’s neutral lipid drug delivery platform technology has great potential to systemically deliver antisense drug candidates in human bodies. Its pipeline has been expanded by new indications and can be easily expanded into other therapeutic areas if the delivery platform technology proves successful for current cancer indications.

We are encouraged by the progress BPTH has made with its lead drug candidate Liposomal Grb-2. We are impressed by the interim results, which have demonstrated the safety and potential efficacy of the candidate. We are especially impressed by the suggestion of possible anti-leukemia activity at the very low dosage, which was an unexpected and very positive result. We are also pleased to see the Company is expanding its pipeline by developing new indications of its lead compound L-Grb-2. 

In terms of valuation, we think Bio-Path shares are undervalued at this point. By comparing to its peers in the biotech industry and considering the potential of its drug delivery technology and progresses the Company has made in the past few months, we think Bio-Path’s stock should be trading around $1.00 per share, which value the Company at about $62 million in market cap.

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  • Discussions with senior breast cancer researchers at the MD Anderson Cancer Center indicated strong scientific case that blocking Grb-2 protein using L-Grb-2 has the potential to be an effective treatment for TNBC and IBC
  • Bio-Path’s plan is to develop Liposomal Grb-2 as a targeted therapy against TNBC and IBC

  • the first is to develop Liposomal Grb-2 as a tumor reduction agent in  combination with other approved drugs in pre-operative settings;
  • the second is to develop Liposomal Grb-2 as a drug to treat and control or eliminate cancer metastasis in TNBC and IBC patients;

  • Both of these treatment goals address high need situations for patients.
  • Development plan: 2013 comprised of pre-clinical development followed immediately by Phase I clinical trial;

  • The preclinical programs are expected to start in 2013 and last one year, after which time the Phase I clinical trial could begin after FDA approval to proceed;

  • Safety of L-Grb-2 established in leukemia trial can speed dosing in the TNBC/IBC trial