Avid Bioservices Inc (CDMO)

[DewDiligence]

>> Am I correct in assuming the Branchburg facility is IMCL's and that Lonza was the original manufacturer of Erbitux? <<

Yes.

>> Since the latest press releases have highlighted the manufacturing issues, I am still not fully enlightened on what is actually involved here. <<

As you surmised, the issue is presumably bioequivalence between the two production methods. The drug used in Merck KGaA’s clinical trial (the main trial supporting the BLA) was from Lonza.

>> Do you agree with McCamants comments on valuation, I still think Erbi's potential is still not fully realized until further clinical trials are enrolled treating first line colorectal patients. Then there is the NCI wanting to test Erbi with Avastin and Oxiplatin. <<

I think IMCL is overpriced because I expect Erbitux’s period of large sales to be relatively brief. By the time there is clinical data to support the use of Erbitux in first-line colorectal cancer or in any form of NSCLC, I expect newer and better therapies to be hitting the market. As a result, placing a lofty P/E multiplier on IMCL’s earnings during any of the next few years seems inappropriate mathematically.