Wednesday, December 6th 2023

Roquefort Therapeutics PLC

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Time for Roquefort Therapeutics to rock?


“…With biotech stocks down and having suffered the industry’s worst bear market since the 2000s, is Rocquefort Therapeutics worth a look at a 52 week low?…”


Through a brutal year for biotech stocks newcomer Roquefort Therapeutics (LON: ROQ) has continued to build a platform for the development of its suite of novel anti-cancer medicines. With the sector showing signs of a revival, is the company set to benefit from a seeming change in market sentiment?

Since going public in March last year the company has passed two major staging posts on the way to its goal of developing novel patent-protected pre-clinical anti-cancer medicines with the purchase of a pair of subsidiaries: Lyramid, last December, focused on the development of treatments designed to inhibit Midkine, a human protein associated with cancer progression; and, this March, Oncogeni, founded by Nobel Laureate Professor Sir Martin Evans, which has developed two families of innovative cell and RNA (a nucleic acid present in living cells with structural similarities to DNA) oncology medicines.



Midkine has long been known to be important in embryonic development, and to play a beneficial protective and regenerative role in the early stages of acute coronary heart events and strokes, and retinal injuries. But research by Lyramid and others indicates that it hinders the normal immune response to tumours, impeding the operation of mainstream cancer immunotherapy drugs. While carried by and barely detectable in healthy adults, Midkine becomes apparent in cancer, kidney, chronic cardiac, lung and liver diseases, autoimmune disorders, osteoporotic fracture healing, and neural injury and neurodegenerative disorders. It may also be a key driver of lung and multi-organ pathologies associated with COVID-19.

Lyramid has invested some $27m over the past decade demonstrating that Midkine suppression promotes a positive response from cells when fighting various diseases, and developing an industry-leading portfolio of patents for treatments targeting the protein. The technologies block Midkine with small molecule inhibitors, antibodies, gene silencing and decoy proteins that slow tumour growth, reduce metastasis, and overcome treatment resistance, especially immunotherapy with immune checkpoint inhibitors. Through Lyramid ROQ collaborates with international research institutes such as the Biozentrum/LMU in Munich to study inflammatory processes and heart failure, UTSW-Dallas for cancer, Complutense University, Madrid (Glioma), Salghrenksa Academy, Gothenburg (multiple sclerosis), University of Colorado (cardiology), Ulm University (bone), INSERM Paris (angiogenesis), and Tokyo MD Uni (cancer).

Lyramid has moved into the pre-clinical phase of developing ‘antisense oligonucleotide’ medicines targeting Midkine, which is expected to deliver a suite of new patented drugs suitable for broad clinical application. ROQ says that oligonucleotide drugs ‘are expected to have a more rapid path to the clinic’ than biologic drugs such as antibodies. If trials are successful the company will consider licensing the drugs at either IND (investigational new drug) application or clinical proof of concept (post phase 2 clinical studies) stages.

This year ROQ has pushed ahead with Antisense Oligonucleotide and ‘Antibody Therapeutic’ programmes. The former was rooted in a collaboration with Murdoch University in Western Australia which designed and tested a series of Midkine gene silencing reagents suitable for ‘in vitro’ (test tube) screening in cancer cells. These generated positive results demonstrating that the lead candidates significantly reduce Midkine mRNA levels seen in human cancer cells. ROQ has now developed a patented family of proprietary oligonucleotides which achieve 90pc Midkine inhibition and demonstrate the ability to modify Midkine mRNA in vitro cancer cell culture models. The company is now planning to commence collaborative work with cancer researchers to assess the ability of the inhibitors to modify in vitro tumour cell behaviour as a prelude to further trials testing the efficacy of the lead oligonucleotide drug candidates using in vivo (testing in living organisms) models of solid tumours.

The second programme involved a strategic and scientific review of the antibody therapeutic programmes Lyramid had been pursuing prior to the subsidiary’s acquisition, which identified two ‘potentially high commercial value’ antibody prospects – ROQA1 and ROQA2 – in advanced stages of pre-clinical development, both demonstrating significant effectiveness in attacking breast and lung cancer. Antibodies suitable for humans have been manufactured for both programmes, with ROQA2 being successfully tested in rodent and a non-human primate toxicology studies. The company is ‘accelerating development’ of the ROQA1 and ROQA2 antibody programs which are on track for CTA/IND filing in late 2023. An August update noted further progress, reporting that in vitro experiments on the company’s oligonucleotides had further proved their capacity to truncate Midkine proteins in cancer cells, underpinning the company’s ability to progress to in vivo studies and, ‘in due course’, clinical trials. ROQ presented its pre-clinical results at a meeting of the European Society of Gene & Cell Therapy last month, where the company made the case that its ‘proof-of-concept study highlights the potential for a new class of medicines blocking Midkine production to target some of the most difficult to treat cancers.’



ROQ built out the company further this summer with the £5.5m acquisition – supported by a £1m placing – of Oncogeni, a UK biotech venture focused on two families of patent-protected innovative cell and RNA oncology medicines, both in pre-clinical development. Following the purchase ROQ’s expanded portfolio now consists of four fully funded, novel, patent-protected pre-clinical anti-cancer medicines: Midkine antibodies with significant in vivo efficacy and toxicology studies; Midkine RNA therapeutics with novel anti-cancer gene editing action; Mesodermal Killer (MK) cells, a new class of cellular medicine engineered to kill cancer both directly and by enhancing the activity of Natural Killer cells; and novel siRNAs (small interfering RNA) inhibit STAT-6, which kill solid tumours.

The acquisition brought considerable additional expertise to ROQ’s board. Ajan Reginald, with experience in commercialisation both within big pharma and in biotech, becoming CEO, and Professor Sir Martin Evans, who won the Nobel Prize for his work in embryonic stem cells and DNA research, becoming Group Chief Scientific Officer. Professor Armand Keating, a leading expert in anti-cancer cell therapy, has been appointed Chief Medical Advisor. The purchase also furnished the group with a cutting edge laboratory and manufacturing facility which promise to significantly reduce time and costs through pre-clinical stages of development. ROQ says it now has a platform commensurate with its ambitions. Noting that the average valuation of biotech companies with a single lead asset completing pre-clinical development is around $71m, ROQ maintains that ‘It is very rare for a company of our size and valuation to have four substantial anti-cancer pre-clinical assets, and we have the potential to drive significant value from our novel oncology programs.’ Now ‘better placed with Oncogeni to complete the value milestone of IND/CTA filings’ the company aims ’to have one program clinic ready during H2 2023’.

Biotech: green shoots?


ROQ has had to weather a brutal year for biotech stocks, which have suffered the industry’s worst bear market since the 2000s when the NASDAQ biotechnology index dropped 70pc over three years. The index has fallen by about a third since peaking in September last year, and the S&P XBI of smaller companies has fallen 41pc since last November’s high. The fall has been part of a wider shakeout of overvalued, speculative growth stocks. During the pandemic many non-specialist investors piled into the market, placing too much trust in unproven companies with stories to tell.

But there are signs that more robust biotech stocks are picking up. The industry raised $5.2bn in the third quarter, more than the first and second quarters combined. Hedge funds have been taking advantage of bargains, and big pharma is cashed up, with some $300bn to spend replenishing pipelines that will need refilling after major patents expire in a few years. In recent months Pfizer has bought Biohaven for $11.6bn and Global Blood Therapeutics for $5.4bn, and Merck is reportedly discussing a $40bn bid for oncology company Seagen. Quoted in the Financial Times, Antoine Papiernik, chair of venture capital firm Sofinnova Partners, looked at the longer term picture for biotech: ‘We believe healthcare and life sciences will be a huge area for secular industry. People don’t want to die. It’s pretty basic.’



ROQ’s value has dropped this this year, down just over 40pc to 7p at the time of writing, bringing the company’s market cap to £5m. The stock is not too far shy of its original IPO price of 8.7p (it spiked at 12.75p during last year’s ongoing tech boom). Clearly, these are very early days for ROQ, which has yet to move to the clinical trial phase, so far devoting its energies to building a platform for growth. The company now seems to have the foundation it needs, had cash of £3,328,573 (as of 30 June), has plenty of intellectual firepower, and is unfolding a strong case for the potential benefits of its drugs. If the company can maintain steady progress, and the biotech sector continues to pick up, ROQ may be in a good position to ride the wave.


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