VBI Vaccines Inc.

VBIV Details

VBI Vaccines Inc. (NASDAQ: VBIV) is a US-based biotechnology company that develops and sells vaccines to treat infectious diseases and immuno-oncology. VBIV leverages its novel virus-like particle (VLP) approach, including enveloped VLP (eVLP) platform technology to develop enveloped virus-like particle vaccines that closely mimic the target viruses, designed to stimulate the natural power of the human immune system. As of August 10, 2021, the company's market capitalization stood at USD 801.31 million.

Step Towards Regulatory Approval: On July 1, 2021, VBIV announced that the American Medical Association (AMA) Current Procedural Terminology (CPT) panel assigned a unique CPT code for a 3-antigen (S, Pre-S1, Pre-S2) Hepatitis B (HBV) vaccine. This code will be used to differentiate VBIV-antigen HBV vaccine candidates from other single-antigen HBV vaccines (if approved). VBIV's vaccine is currently under regulatory review for marketing approval in the US and Europe with a Prescription Drug User Fee Act (PDUFA) target action date of November 30, 2021.

Progress Towards Development of COVID-19 Vaccine: On June 29, 2021, the company announced positive results for the Phase 1/2 trial for its COVID-19 vaccine candidate, VBI-2902a, in healthy adults 18-54 years of age. The vaccine was well-tolerated with no safety signals observed, and it induced neutralization titers in 100% of participants after two doses.

Q2FY21 Results: The company reported a YoY decline of 29.58% in revenues to USD 0.14 million in Q2FY21 (ended June 30, 2021) compared to USD 0.18 million in Q2FY20, attributable to a decrease in R&D services revenues. Net loss for Q2FY21 increased 83.71% to USD 17.48 million compared to USD 9.51 million in Q2FY20. As of June 30, 2021, the company had cash and cash equivalents of USD 135.03 million and total debt of USD 27.45 million.

Key Risks: VBIV depends on a single manufacturing facility in Rehovot, Israel, for clinical and commercial supply of 3-antigen prophylactic HBV vaccine and VBI-2601. Therefore, any disruption in its production process could adversely impact its operations. Furthermore, VBIV operates in the biotechnology industry, which is subject to several federal, provincial, and state regulations, non-observance of which could impact its financial performance.

Outlook: As of Q2FY21, VBIV expects to start the next phase of the ongoing Phase 1/2 study for VBI-2905, its vaccine candidate against the COVID-19 Beta variant, in Q3FY21. It also plans to commence the clinical study for multivalent vaccine candidates to extend the range of protection against known and emerging variants of COVID-19 by H1FY22. In Q4FY21, the company forecasts to initiate a clinical study of VBI-1901, a cancer vaccine immunotherapeutic candidate, which rides on grant of fast-track designation granted by the US Food and Drug Administration (FDA).

Valuation Methodology: EV/Sales Multiple Based Relative Valuation

(Analysis by Kalkine Group)

* % Premium/(Discount) is based on our assessment of the 'company's NTM trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.

VBIV Daily Technical Chart (Source: REFINITIV)

Stock Recommendation: VBIV's stock price decreased by 6.19% and increased by 10.58% in the past one and three months, respectively, and is currently leaning towards the lower band of its 52-week range of USD 2.07 to USD 5.20. The stock is currently trading below its 50 and 200 DMA levels, and its RSI Index is 44.44. We have valued the stock using the EV/Sales-based relative valuation methodology and arrived at a target price of USD 3.36. Considering the slight movement in the stock price, considerable progress in COVID-19 and 3-antigen HBV vaccine, we recommend a "Hold" rating on the stock at the closing price of USD 3.03, down 3.19% as of August 10, 2021.

* All forecasted figures and Industry Information have been taken from REFINITIV.

* The reference data in this report has been partly sourced from REFINITIV.