In MedicalGold’s end of 2022 article, titled “The Biotech Despair of 2022 Has Planted The Seeds For A Bull Market In 2023”, we highlighted three companies whose share prices had been so badly beaten in 2022 that they almost had to move higher in the new year. So far, the market has proven our analysis correct. Here are the gains since December 28th, 2022 for the three companies we selected in our December article: ENVB, MDNA, and NUMI.TO.
Enveric Biosciences (NASDAQ: ENVB) is a biotechnology company dedicated to the development of novel small-molecule therapeutics for the treatment of anxiety, depression and addiction disorders. Enveric is committed to developing novel treatments to transform the lives of patients living with mental illness. We are pursuing new pathways and targeting impaired neural circuitry with the goal of improving brain health. Our mission is to pioneer new and innovative solutions with the potential to have profound effects on patients and their families, and to deliver life-changing medicines for diseases affecting the brain. Enveric is headquartered in Naples, FL with offices in Cambridge, MA and Calgary, AB Canada.
At the end of December, Enveric reached a level of oversold capitulation tax-loss harvesting that we have rarely seen before. Since reaching a low of $1.62 on December 28th, ENVB shares have rebounded nearly 80% back to an area of previous support near $3.00.
Medicenna (NASDAQ:MDNA) is a clinical stage immunotherapy company focused on the development of novel, highly selective versions of IL-2, IL-4 and IL-13 Superkines and first in class Empowered Superkines. Medicenna’s long-acting IL-2 Superkine, MDNA11, is a next-generation IL-2 with superior CD122 (IL-2 receptor beta) binding without CD25 (IL-2 receptor alpha) affinity thereby preferentially stimulating cancer killing effector T cells and NK cells. Medicenna’s early-stage BiSKITs™ program, (Bifunctional SuperKine ImmunoTherapies) is designed to enhance the ability of Superkines to treat immunologically “cold” tumors. Medicenna’s IL-4 Empowered Superkine, MDNA55, has been studied in 5 clinical trials including a Phase 2b trial for recurrent GBM, the most common and uniformly fatal form of brain cancer. MDNA55 has obtained Fast-Track and Orphan Drug status from the FDA and FDA/EMA, respectively.
Medicenna briefly traded down to BELOW its cash value on December 28th when it traded at $.40 per share on the Nasdaq. The retest of the $.40 support level put in place a DOUBLE-BOTTOM. Since then, MDNA shares have rallied more than 60%.
It is difficult to justify MDNA's deflated ~$42M USD market cap based on the quality of the company's advanced drug development programs. Their Phase 1/2 clinical trial (“ABILITY”) for MDNA11, a variant of the immunomodulating IL-2 cytokine, as a treatment for solid tumors (e.g. metastatic melanoma, renal cell carcinoma, sarcoma, etc.) is in the final dose escalation stage and we should expect new data in this first quarter (1Q23). MDNA11 has been engineered to solve many of the dosing and toxicity problems for proleukin, an FDA approved IL-2 therapy that has been used to treat melanoma and renal cell carcinoma since the 1990s. Preclinical analysis has shown favorable dosing characteristics with limited toxicities, allowing MDNA11 to be dosed less frequently and in much lower concentrations (thereby limiting toxicities), while producing a dramatically higher therapeutic effect (e.g., activation of CD8+ T cells to kill the cancer cells). Interim data from the ABILITY trial shows tumor “control” in five of the 14 currently enrolled patients, and a confirmed partial response in a single patient suffering from pancreatic ductal adenocarcinoma (one of six different solid tumors being treated in the study). In collaboration with Merck, the ABILITY trial will be extended to examine the efficacy of MDNA11 in combination with KEYTRUDA® (pembrolizumab), the pharmaceutical giant's anti-PD-1 therapy.
Medicenna's most advanced drug asset is MDNA55, another immuno-oncology biologic that activates the immune system to hunt and kill tumors, for the treatment of glioblastoma multiforme (GBM). Results from the company's Phase 2b trial were promising with an overall survival (OS) of 11.8 months, considerably longer OS of the approved drugs carmustine (OS of 5.1 – 7.5 months), lomustine (OS of 7.1 – 9.8 months), and temozolomide (OS of 5.4 – 9.9 months). Medicenna is currently pursuing a partnership strategy to facilitate MDNA55’s further development through the planned Phase 3 clinical trial. Following an End of Phase 2 meeting with the United States Food and Drug Administration (FDA), the agency agreed that Medicenna could conduct an open label hybrid Phase 3 trial that allows use of a substantial number of subjects (two-thirds) from a matched external control arm to support regulatory approval of MDNA55 for rGBM. The FDA also expressed their willingness to consider an interim analysis of the trial if certain criteria are met. Unlike conventional randomized control trials, the hybrid trial design will reduce the overall number of subjects needed in the study to achieve the primary endpoint as well as reduce the cost and timelines associated with completing the trial.
On January 5th, Medicenna announced that it strengthened its intellectual property protection with the issuance of a U.S. Patent covering methods of treating solid cancers with an IL-2 “Superkine” and PD1/PDL1 or CTLA-4 checkpoint inhibitor, administered in combination or as a single agent via their BiSKIT™ platform. This newly issued patent adds to Medicenna’s portfolio of patents and applications providing protection for MDNA’s innovative IL‐2 Superkines, including MDNA11, in the U.S., Europe, Japan, China, Canada, India, and Australia.
We expect Nasdaq-listed MDNA shares to find some chart based resistance near the $.80 level over the next couple weeks. Traders can de-risk their positions after a sizable rally in MDNA’s share price to begin 2023.
Numinus Wellness (TSX: NUMI) helps people to heal and be well through the development and delivery of innovative mental health care and access to safe, evidence-based psychedelic-assisted therapies. The Numinus model - including psychedelic production, research and clinic care - is at the forefront of a transformation aimed at healing rather than managing symptoms for depression, anxiety, trauma, pain and substance use. At Numinus, we are leading the integration of psychedelic-assisted therapies into mainstream clinical practice and building the foundation for a healthier society.
Numinus shares made a triple-bottom at C$.165 in the final week of December, and Numinus CEO Payton Nyquvest decided to use the opportunity to add to his stack of shares with an open market purchase of 100,000 shares.
Numinus is leading the charge in the medical psychedelics sector through the development and delivery of innovative mental health care and access to safe, evidence-based psychedelic-assisted therapies. The company released Q1 earnings and hosted an investor conference call yesterday. After listening to the conference call, MedicalGold noted that:
MedicalGold will be publishing a featured article focusing on Numinus in the next week, stay tuned for our update.
For those who positioned themselves correctly in the final weeks of 2022, the hardest part will be exercising the will to “be right and sit tight” - for those who are feeling some FOMO in the first couple weeks of 2023 we recommend the following process:
Giving into FOMO is the fastest way to part with your hard earned money in financial markets. It is better to miss a trade completely than to chase it due to the Fear Of Missing Out. In markets, money is made by waiting; waiting for the right entry point, and then waiting for the bull market to generate gains over the long term.
We nailed the sector low in December 2022 and you can count on MedicalGold to continue to diligently cover the fundamental as well as technical developments across the Canadian microcap biotech space in 2023.
The work included in this article is based on current events, technical charts, company news releases, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decision based solely on what you read here. This publication contains forward-looking statements, including but not limited to comments regarding predictions and projections. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. This publication is provided for informational and entertainment purposes only and is not a recommendation to buy or sell any security. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions. Junior resource and biotechnology companies can easily lose 100% of their value so read company profiles on www.SEDAR.com for important risk disclosures. It’s your money and your responsibility.