Wednesday, September 27th 2023

Cizzle Biotechnology Holdings PLC

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Is Cizzle set to sizzle or simmer ?


“…There are promising signs. Its lung cancer proposal is backed by years of research, and offers clear commercial promise as well as the prospect of relieving the suffering of millions of cancer patients…”


We have highlighted several intriguing biotech opportunities this summer and autumn, the most recent including Hemogenyx Pharmaceuticals (LON:HEMO), Poolbeg Pharma (LON:POLB) and Oxford Cannabinoid Technologies (LON:OCTP). Newly-listed Cizzle Biotechnology Holdings (LON:CIZ), focused on patent protected technology for the early detection of lung cancer, is another to look for.

Cizzle’s concept is the product of 15 years of research at the University of York, led by cell biologist Professor Dawn Coverley, the new company’s Chief Scientific Officer. Lung cancer is one of the world’s most common cancers, responsible for more than two million new cases every year. It produces few clinical symptoms, making it notoriously hard to diagnose: the majority of lung malignancies have already spread by the time they are detected.

CT (Computerized Tomography) scanning is the most common means of detection, but has a false positive rate of approximately 90pc, forcing many patients to undergo invasive radiation treatments that may well prove ultimately ineffective. Cizzle’s proposed test requires a simple blood sample, which is screened for the presence of a ‘biomarker’, a cell protein called CIZ1 B generated by early stage lung cancer. It promises an elegant solution for early diagnosis through a cheap and straightforward procedure, minimising patient discomfort and reducing the burden on CT scanners.

Cizzle has developed a proof-of-concept prototype test that with CE marking and US Food and Drug Administration approval could be used within hospital laboratories and, after further refinement, in doctors’ surgeries. Initial research into the test was funded by charities and funds including Yorkshire Cancer Research, White Rose Technology Seed Corn Fund, Finance Yorkshire Seedcorn LLP and Viking Members. Cizzle was acquired this April for £21m by AIM-quoted cash shell Bould Opportunities, and listed under the name a month later, raising £2.2m for future development, and bringing in former Bould chairman Dr Allan Syms, who has 30 years’ experience as a life sciences and technology senior executive, as Executive Chairman.

Post-launch progress


Cizzle took two notable steps over the summer towards development of the test. In July the company entered into an agreement with clinical research specialists FairJourney Biologics to begin the process of upgrading the prototype testing methodology to meet the regulatory standards required for its use in hospital laboratories. And earlier this month Cizzle consolidated its research partnership with York University, extending the agreement to allow seconded staff – including Fairjouney Biologics representatives – access to the University’s research facilities.

Cizzle also opened up a possible new source of income by entering into a royalty sharing agreement, signed last month, with St George Street Capital (SGSC), the UK biomedical charity discussed in our recent feature on Vela Technologies (AIM:VELA). As we noted SGSC takes clinical-ready assets from pharmaceutical companies and seeks to progress them through Phase II medical trials, before licensing them for Phase III trials and commercialisation. The charity has made significant progress towards commercialising a treatment for diabetic patients suffering with Covid, who the virus hits particularly hard. Encouraging results from Phase II clinical trials indicate that the treatment, which can be administered through tablets, is safe, and effective at controlling the high blood glucose levels that aggravate Covid in diabetics patients. The trial gives SGSC the green light to enter discussions with potential licensees, and data to support funding for further trials.

Under the new agreement Cizzle will develop a ‘companion diagnostic’ for the administration of the Covid treatment, a medical device facilitating the drug’s safe and effective use. SGSC will pay Cizzle ‘milestone payments’ of up to £1m to fund each phase of the work needed to develop the diagnostic. If the treatment is successfully commercialised Cizzle would receive future royalty payments of up to £5m. Options for commercialisation exist beyond a possible Covid treatment: the drug has potential uses for other conditions. In consideration of the potential royalty stream Cizzle paid SGSC £200,000 on entering into the contract. Mr Syms said that while the partnership with SGSC opened up ‘an exciting opportunity’ the company’s ‘primary focus remains on progressing our blood test for the early detection of lung cancer, based on the C1Z1B biomarker’.

Looking ahead


Despite its name, Cizzle has so far failed to set the market ablaze. The share price has drifted down since IPO from 10p to less than 5p, hovering just below 4.5p at the time of writing. The company faces the perennial challenge confronting all biotech startups: persuading investors to commit to a bright idea that has yet to travel the long road towards regulatory approval and commercialisation. Can Cizzle stay the course long enough to come good?

There are promising signs. Its lung cancer proposal is backed by years of research, and offers clear commercial promise as well as the prospect of relieving the suffering of millions of cancer patients. Cizzle’s success will depend on its ability to push forward its current projects while securing new partnerships that can generate new revenue streams. The company’s interim results for the six months to 30 June stated a cash balance of £1,425,000. A new research note estimates the company, which will outsource most of its work, will have modest yearly operating costs of around £200,000, giving it a ‘cash runway’ of 18 to 24 months, tiding the company through to the end of next year. The early deals with SGSC and FairJourney suggest that Cizzle does indeed offer skills and experience attractive to partner organisations.

That being so, we wonder whether the market has paid sufficient attention to the progress Cizzle has made so far: biotech prospects require specialist knowledge that can make them difficult to read. This company is a longer term prospect likely to simmer rather than sizzle – but there are a few things to look out for that could push the share price up in the short to medium term. Cizzle has already shown itself to be adept at securing new agreements – more may be on the horizon. There is the prospect of progress with FairJourney towards a standardised test. And the anticipated progress towards commercialisation with SGSC may generate new value points. At less than 5p Cizzle Biotechnology is another fledgling biotech worth adding to a health sector watchlist.