Biotech Values

[DewDiligence]

Re: ASMB valuation and pipeline

AMSB now trading at less than 50% cash value. Folks from Gilead in key management positions. Do you see much value in the pipeline?

Let’s examine ASMB’s pipeline in chronological order.

The first HBV core inhibitor, VBR (f/k/a ABI-H0731), failed in a 2-drug combination with a nucleoside (#msg-159327881) and is now in various combination trials with external agents (#msg-157913492, #msg-166413748). These trials have a low chance of success (IMO) because VBR is a weak agent on its own, so there would need to be an astonishing degree of synergy for such combinations to provide a functional cure for HBV (the goal that all HBV companies are pursuing). All told, the VBR program looks like an example of Zebra’s Law.

ASMB’s second core inhibitor was more potent that VBR, but—alas—it was axed a few months ago due to liver toxicity: (https://www.globenewswire.com/news-release/2021/09/01/2290389/16259/en/Assembly-Bio-Announces-Decision-to-Discontinue-Clinical-Development-of-ABI-H2158.html).

ASMB’s third core inhibitor, ABI-H3733, is in phase-1a (dosing of healthy volunteers), and its fourth core inhibitor, ABI-4334, is in preclinical development. In addition to all that, ASMB is paying (private) Door Pharmaceuticals to develop a “core protein modulator,” which is essentially a tweaked core inhibitor (https://www.globenewswire.com/news-release/2020/11/16/2127221/0/en/Assembly-Biosciences-and-Door-Pharmaceuticals-Sign-Collaboration-and-Option-Agreement-to-Develop-a-Novel-Class-of-HBV-Core-Protein-Modulators.html ).

Given all of the above, how much confidence do you think ASMB has in VBR, ABI-H3733, and even ABI-H3733?

Before ASMB was dedicated solely to HBV, they were pursuing a microbiome program. When they tried to sell the program, there were no takers so they just shut it down (#msg-160021063).

The one positive thing ASMB has done is getting $40M up-front from BGNE for the Greater China rights to ASMB’s core inhibitors in mid-2020 (https://www.globenewswire.com/news-release/2020/07/20/2064219/0/en/Assembly-Biosciences-and-BeiGene-Announce-License-and-Collaboration-Agreement-in-China-for-Assembly-s-Portfolio-of-Three-Clinical-Stage-Core-Inhibitors-for-Chronic-Hepatitis-B-Infe.html ). However, there has been no further word on this program, and there are many companies pursing HBV in China, so I wouldn’t ascribe a lot of value to ASMB from this deal.

I picked ASMB in the SI Charity Contest because the valuation is so low (relative to cash on hand) and they might get lucky (#msg-167357264). The PR in #msg-167370549 summarizes 2022 news flow.