After Surging More Than 100% Last Week, Is This Pharmaceutical Stock a Buy?

Shares of a medium-stage clinical biotechnology company that concentrates on developing novel immuno-oncology therapies have rallied by more than 100% in the last couple weeks. The company’s lead product candidate is…

Mupadolimab (CPI-006), an anti-CD73 monoclonal antibody that is being developed to treat HPV+ head and neck cancer, as well as other cancers caused by viruses. Corvus Pharmaceuticals (CRVS) also has two Phase 1b/2 assets and three early-stage candidates.

On September 17th, CRVS rallied significantly after AstraZeneca (AZN) announced, “the COAST Phase II trial showed oleclumab, an anti-CD73 monoclonal antibody, or monalizumab, an anti-NKG2A monoclonal antibody, in combination with Imfinzi (durvalumab) improved progression-free survival and objective response rate compared to Imfinzi alone in patients with unresectable, Stage III non-small cell lung cancer who had not progressed after concurrent chemoradiation therapy.”

CRVS has a CD73 asset in its pipeline as well, which caused shares to surge to a new 52-week high of $9.54.

Recent Developments 

On September 22nd, Corvus Pharmaceuticals provided an update on Mupadolimab trials in oncology and infectious disease. CPI-006 showed promising results in the COVID-19 study, improving primary and key secondary endpoints. Also, the company enrolls patients with head and neck cancers and lung cancer for the Mupadolimab Phase 1b/2 study. The company plans to deliver trial updates in November. It could serve as a possible catalyst for the stock price if the company reports positive trial data.

Recent Financial Results

Corvus is currently bringing in no revenues, which is typical for a clinical-stage biotech company while they spend substantial amounts of money on research and development (R&D) and general and administrative expenses (G&A).

As of June 30th, 2021, R&D expenses for Corvus Pharmaceuticals registered at $9.1 million compared to $7.86 million in a year-ago period. The 15.7% year-over-year R&D increase is related to the development of Mupadolimab, including clinical trial expenses, manufacturing costs, as well as unallocated employee and overhead costs.

CRVS’ G&A expenses stood 25% lower at $2.18 million. The decrease was related to a reduction in professional service costs and employee-related compensation.

Cash used to run the company’s operations during the second quarter was roughly $21.4 million. As of June 30, 2021, the company reported a…

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