Bayer on the path out of crisis. With their oncology pipelines, are Defence Therapeutics and BioNTech also on the verge of a turnaround?

Bayer - Sending positive signals

Bayer has undoubtedly been through a long dry spell. In addition to the ongoing legal disputes, particularly in the context of glyphosate, Bayer is also under scrutiny by the OECD because of its agricultural model. Critics accuse the Company of not adequately addressing environmental and human rights risks in South American countries. However, Bayer remains steadfast and asserts that it is acting responsibly. At the Annual General Meeting, the Company reaffirmed its strength and resilience and sees a need for action in patent processes, legal cases in the US, high debt and bureaucracy. These issues are to be resolved in a 3-year change process.

The Company recently achieved a major legal victory in the United States, representing a significant turnaround in the ongoing legal dispute over the controversial chemical PCB. The Company, which was caught in the crossfire following its acquisition of Monsanto, successfully appealed a judgment that assessed USD 185 million in damages against them. The appeals court found significant flaws in the lower court's decision and ordered a reassessment of the case. The Leverkusen-based company is examining all options to end the legal disputes. Litigation is currently underway in the US in which sued companies have spun off parts of the business in order to send them into insolvency and thus deprive the plaintiffs of their basis.

But until there is clarity in these cases, Bayer will certainly not go down this road. Bayer strives for progress in medical research. The recent research collaboration with the Hamburg-based company Evotec in the field of precision cardiology demonstrates its commitment to the development of innovative therapeutics. This collaboration builds on the existing productive partnership between the two companies and aims to identify new compounds that could combat cardiovascular disease. The upcoming quarterly results, to be presented on May 14, may provide additional insight into the impact of these developments on the business results. The share seems to have found a bottom and is currently trading at EUR 28.02.

Defence Therapeutics - Revolutionary technology for the fight against cancer

The biotech company Defence Therapeutics wants to revolutionize cancer treatment. With the help of its ACCUM™ technology, which enables vaccine antigens or antibody-drug conjugates (ADCs) to be transported precisely to the diseased cells, Defence is developing the next generation of vaccines and ADC products. This innovation promises increased efficiency and effectiveness in the fight against serious diseases such as cancer. In early May, the Company successfully completed preclinical testing of its ARM-002TM pancreatic cancer vaccine, which showed promising results, particularly in combination with the anti-PD-1 immune checkpoint inhibitor.

This success marks a significant step forward in the future fight against this difficult-to-treat cancer. The vaccine is based on AccuTOX® and has several advantages over current cancer therapies. It stimulates a specific immune response to cure tumors. In addition, it promotes long-lasting immunological memory to protect against recurrence. As a vaccination platform, it uses mesenchymal stem cells for reprogramming into antigen-presenting cells. Last but not least, due to optimized transport, only lower doses are needed to improve antigen presentation in cancer cells, which increases efficiency and may reduce manufacturing challenges.

The scalability of the Accum™ platform should be emphasized. The platform provides a versatile and flexible technology for targeted drug delivery that significantly increases the efficacy of therapeutics. Defence Therapeutics has engaged FMS Consult GmbH to design a corporate financing strategy to drive growth and accelerate development. Nevertheless, the share has been sold off since the beginning of February. The trading volume on May 1 in Canada was striking when many shares were sold, and the share price stopped falling. It seems as if a big seller could be ready. Just one day later, the share price shot up again by over 40% and is currently trading at CAD 1.47.

BioNTech - Quarterly figures in focus

Today, May 6, investors will turn their attention to BioNTech, which will publish its quarterly figures. With projected earnings per share of USD -1.18 and estimated revenues of USD 469.09 million, this represents a year-on-year decline of 63.9%. However, BioNTech's track record to date gives cause for hope: both revenue and earnings estimates have recently been exceeded time and again. Despite a series of adjustments to profit expectations in the last three months, the Company has proved robust in the face of market fluctuations.

BioNTech's true strength lies in its advanced oncology pipeline. Following the success of its mRNA vaccine against COVID-19, which led to high uptake through a partnership with Pfizer, the Company is now increasingly focusing on the development of precision therapies against cancer. Its portfolio includes 20 programs in oncology that promise a broad range of treatment options - from mRNA therapies to CAR-T cell therapies. Of particular note is the CAR-T cell therapy BNT-211, which has shown promising results in clinical trials in combination with the CARVac vaccine.

Despite the challenges posed by the slowing COVID-19 vaccine business, BioNTech's valuation gives cause for optimism. The current share price may not reflect the Company's full potential, especially considering its advancing pipeline and the prospect of future revenues from cancer vaccines. Added to this is the high cash position, which allows research to continue at full steam. The share has recently been able to break away from its low for the year and is available for EUR 86.10.

Shares in the pharma and biotech sectors are often highly volatile. Especially when the business is based on a few drugs, a positive announcement can then quickly catapult a share upwards. If, on the other hand, things go badly in studies, a share can also be punished, as was the case with Bayer with the blood thinner Asundexian. The Leverkusen-based company took a number of measures to initiate the turnaround. This has already begun at Defence Therapeutics. Operationally, the research reports were positive, yet the share price slipped. After the big sell-offs, a major seller could be ready, and the way up would be clear again. At BioNTech, sales declines were to be expected, yet the stock was pushed down repeatedly. The large oncology pipeline and the high cash position should provide more optimism.