MEI Pharma, Inc. (MEIP)

[EM]

$MEIP

From last presentation
http://www.meipharma.com/sites/default/files/meip_presentation_-_stifel_nov_2016_-_final_2_0.pdf

FINANCIAL HIGHLIGHTS
$58.9 million in cash as of September 30, 2016
Net loss of $4.5 million for three months ended September 30, 2016
No debt
36.8 million shares outstanding
CASH per share: $1,7

PIPELINE

1. Pracinostat
http://investor.meipharma.com/2016-12-05-Helsinn-Group-and-MEI-Pharma-Report-Prolongation-of-Survival-Results-from-Phase-2-Clinical-Study-of-Pracinostat-and-Azacitidine-in-Acute-Myeloid-Leukemia
Helsinn, a Swiss pharmaceutical group focused on building quality cancer care products, and MEI Pharma, Inc. (Nasdaq: MEIP), an oncology company focused on the clinical development of novel therapies for cancer, announced final results from a Phase 2 clinical study of the investigational drug candidate Pracinostat and azacitidine in elderly patients with acute myeloid leukemia (AML) who were not eligible for induction chemotherapy, including evidence of prolongation of survival in the overall population and across a number of patient subgroups.
In an oral presentation at the American Society of Hematology (ASH) Annual Meeting on Saturday, Dr. Guillermo Garcia-Manero, MD Anderson Cancer Center, principal investigator of the study, reported a median overall survival of 19.1 (95%CI: 10.7-26.5) months, one-year survival of 62% and a complete response (CR) rate of 42%.

Conclusion from ASH meeting
http://www.meipharma.com/sites/default/files/ash_2016-pracinostat-aza_aml_-_final.pdf
i. Pracinostat + azacitidine is well tolerated in elderly AML
ii. Prolong survival in the overall population and in patient subsets defined by cytogenetics risk group, de novo or secondary AML, age and ECOG performance status
iii. Results compare favorably to the Phase 3 study of azacitidine in a similar AML patient population
iv. Marrow remission typically achieved within the first 2 cycles, but prolonged exposure required in some patients to maximize response
v. Site recruitment is ongoing for a global Phase 3 study of Pracinostat + Azacitidine in newly diagnosed
vi. AML patients unfit for intensive induction chemotherapy

Recently deal with Helsinn:
i. Exclusive licensing, development and commercialization agreement for Pracinostat in AML and other hematologic diseases
ii. Helsinn responsible for funding global development and commercialization
iii. $20 million in near-term cash payments
iv. $15 million upfront + $5 million on Mar 1, 2017 or upon dosing of first patient in Phase III study
v. Up to $444 million in regulatory and sales-based milestones
vi. Tiered royalty payments in U.S. and selected territories
vii. Agree to share cost of Phase II study to explore optimal dosing regimen of Pracinostat + azacitidine in high and very high risk MDS
viii. MEI responsible for study conduct, expected to start in 1H 2017
ix. $5 million equity investment from Helsinn (avg pps $ 1,91)

2. ME-401
i. Potent and highly selective oral PI3K delta inhibitor
ii. Superior pre-clinical activity compared to the approved drug Zydelig®
iii. On-target binding affinity (KD) >30 times greater
iv. First-in-human, single ascending dose study completed
v. Superior PK/PD profile to Zydelig®
vi. PK confirms once-daily dosing
vii. Potential for wide therapeutic window

3. ME-344
i. Mechanism of action directly targets mitochondrial OXPHOS complex I1, resulting in rapid loss of cellular energy (ATP)
ii. Evidence of single agent activity in Phase I dose-escalation study in refractory solid tumors2
iii. Exciting pre-clinical data demonstrating interplay between tumor cell glycolysis and mitochondrial metabolism in combination with VEGF inhibitors3,4
iv. Investigator-sponsored study in combination with Avastin® in HER2- breast cancer now open for enrollment

INTELLECTUAL PROPERTY
Pracinostat
4 issued U.S. and 77 issued foreign patents ? 2 U.S. and 8 foreign applications pending
Composition of matter to May, 2028 in U.S.
May, 2033 with up to 5 years patent term restoration in U.S.
ME-401 (formerly PWT143)
2 issued U.S. patent
1 U.S. and 21 foreign applications pending
Composition of matter to Dec. 2032 in U.S., excluding patent term restoration
ME-344
3 issued U.S. and 18 issued foreign patents ? 3 U.S. and 7 foreign applications pending
Composition of matter to March, 2027 in U.S.
March, 2032 with up to 5 years of patent term restoration in U.S.

CATALYSTS
Pracinostat
Initiation of Phase III study in newly diagnosed AML, ≥75 years or unfit for intensive chemotherapy (Q1 2017)
Initiation of Phase II dose optimization study in high & very high risk MDS (1H 2017)
ME-401
Phase Ib study in CLL & fNHL open for enrollment
Early cohort data from Phase Ib study in CLL & fNHL (Q2 2017)
ME-344
HER2-negative breast cancer study open for enrollment
Results from HER2-negative breast cancer study (Q4 2017)

INSTITUTIONAL OWNERSHIP: 16% (funds have increased their positions per last SEC form 4).
At Q3’s end, a total of 6 of the hedge funds tracked by Insider Monkey held long positions in this stock, a gain of 100% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were increasing their holdings meaningfully (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Jim Simons’ Renaissance Technologies has the biggest position in MEI Pharma Inc (NASDAQ:MEIP), worth close to $2.1 million. Coming in second is Iguana Healthcare Management, led by Stuart Weisbrod, which holds a $0.5 million position. Other hedge funds and institutional investors with similar optimism comprise Millennium Management, one of the 10 largest hedge funds in the world, Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk’s GRT Capital Partners, and Ken Griffin’s Citadel Investment Group. We should note that GRT Capital Partners is among our list of the 100 best performing hedge funds, which is based on the performance of their 13F long positions in non-micro-cap stocks.

Insider Ownership: 16% (no activities in the last months).

Average target price for analysts: $ 2,30