Access Pharma: Continues to make progress to monetize its CobOral drug delivery technology
Yesterday (October 27, 2010), Access Pharmaceuticals Inc. (ACCP) announced it has entered into a pre-licensing feasibility agreement with a leading biopharmaceutical company to develop an oral formulation of an undisclosed prostate cancer compound utilizing its proprietary vitamin B-12-based CobOral™ Drug Delivery Technology.
Access will develop CobOral formulations for testing by the biopharma company. Though the terms of the agreement have not been disclosed, Access indicated that any successful formulation developed will be jointly owned by the Parties and subject to a subsequent full licensing agreement.
We are impressed with the progress Access has made in the last few months about its CobOral drug delivery technology. In addition to applications for oral insulin, human growth hormone and siRNA developed in house, the company has made great efforts to expand the application to other areas and great progress has been made so far.
In July 2010, Access entered into a pre-licensing feasibility agreement with a leading biotechnology company to develop an oral formulation of its currently-marketed, proprietary injectable drug. Access will utilize its proprietary CobOral (Cobalamin Oral Drug Delivery) Technology to develop oral formulations of the drug for pre-clinical testing. Although the name and the terms of the agreement have not been disclosed due to competitive reasons, management indicated that any successful formulation developed will be subject to a subsequent full-licensing agreement.
We believe these alliances further validate Access’s drug delivery technology. It will also strengthen the company’s balance sheet in the event of any upfront and milestone payments. As part of this deal, Access filed new patent applications on formulations, and has covered probably 50 of the top selling injectable drugs. This may have strategic implications for the company. Management has indicated that there are a few other big pharma companies which are interested in the alliance to use Access’ CobOral Drug Delivery System.
We have an Outperform rating on Access shares and our six to twelve month price target is $8 per share.
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