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In addition to our published ideas, we aim to share what we believe are other interesting and timely opportunities that members can research but which we believe are not yet ready for publication. We hope that members will be equally forthcoming with their own ideas (no price sensitive information please) in order to broaden the investment debates.
The first of these ideas is Avacta Group plc (AIM:AVCT). The company has 3 proprietary therapeutic/diagnostic platforms, with the greatest current valuation catalyst being the preCISION platform which aims to make chemotherapy pro-drugs inert as they flow through the body and then activate only in cancer tumours, greatly increasing the dosage patients can tolerate and improving outcomes without damaging healthy tissue and organs, specifically the heart. The company is currently in Phase 1B clinical trials of its first pro-drug (AVA6000) with a near term expectation of a 2nd dose escalation announcement (which would give a further indication that the drug is safe and working). If the platform proves successful, the company could come to dominate and expand the global chemotherapy market. On the other hand, as with any biotech undergoing trials in as yet unproven drugs/platforms, the outcome is binary and the value could be zero. In this case, with numerous drug conjugate candidates as well as the Affimer and TMAC platforms, alongside licensing deals and partnerships with multi-national pharma companies, the company has several shots on goal, each of which could be worth multiples of the current market value. With a current market cap of c.£300m (and a net cash position), this is a highly risky investment opportunity, but with a currently unquantifiable upside valuation potentially in the billions. We are investors in Avacta and would be happy to discuss our views on the business (recent history around COVID LFTs etc) and management, but we would like to see further progress and be able to quantify the potential valuation with some degree of accuracy before publishing an idea memo.
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