ACE Investors

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By Team Ace Investors

Company Overview

Starpharma Holdings Limited (ASX: SPL, OTCQX: SPHRY) is a world leader in dendrimer technology for medical applications. Starpharma is focused on developing and commercializing novel therapeutic products that address significant global healthcare needs. Starpharma’s innovative technology is based on proprietary polymers called dendrimers, which are precise, synthetically manufactured, nanoscale molecules. The unique properties of dendrimers – including their size, structure, high degree of branching, polyvalency, and water solubility – are advantageous in medical and pharmaceutical applications. Starpharma has developed a unique and valuable delivery platform known as DEP® (Dendrimer Enhanced Product), which utilizes dendrimers to improve the effectiveness and safety of conventional and new drugs. DEP® has been widely applied in oncology but also has application to other classes of drugs, such as anti-infectives. Starpharma utilizes its dendrimer technology to develop novel therapeutics and enhance the performance of existing pharmaceuticals. Starpharma boasts a strong portfolio of products, partnerships, and intellectual property.

Starpharma’s portfolio includes multiple clinical-stage oncology products, which utilize its Dendrimer Enhanced Product ('DEP®') drug delivery technology, and marketed products, including VIRALEZE™ and VivaGel® BV, which utilize SPL7013, a proprietary dendrimer with antimicrobial properties.
In addition to Starpharma’s internal DEP® programs, Starpharma has multiple DEP® partnerships with international biopharmaceutical companies, including AstraZeneca (oncology), MSD (Antibody-Drug Conjugates), Chase Sun (anti-infectives), and other world-leading pharmaceutical companies.

Starpharma’s topical antiviral nasal spray, VIRALEZE™, is now registered in more than 35 countries*, including Europe, the UK, and Asia. Starpharma’s novel non-antibiotic vaginal gel, VivaGel® BV, for the treatment of bacterial vaginosis (BV) and prevention of recurrent BV, is registered in more than 50 countries, including in the UK, Europe, Southeast Asia, South Africa, Australia, and New Zealand.

Investment Rationale

Focused on extracting value from its dendrimer technology

Starpharma has developed an impressive pipeline of novel DEP® oncology assets. Its clinical-stage assets, DEP® cabazitaxel, DEP® docetaxel, and DEP® irinotecan, are improved versions of commonly used chemotherapeutic drugs that have demonstrated improved anti-cancer effects and safety profiles. Additionally, Starpharma has a promising preclinical pipeline, including DEP® Antibody-Drug Conjugates (ADCs) and DEP® radiotheranostic products. The Company aims to generate value through the clinical development and commercialization of its proprietary products, as well as partnerships with pharmaceutical and biotechnology companies based on its patented dendrimer technology in pharmaceutical and healthcare applications. Starpharma’s strategy involves three key focus areas to drive growth, extract value from the dendrimer technology, and optimize shareholder returns: 1) maximize DEP® asset value; 2) accelerate early asset development; and 3) build long-term sustainability. During FY24, the company completed three Phase 2 clinical trials for DEP® SN38, DEP® cabazitaxel, and DEP® docetaxel, which have generated significant data and clinical validation for its innovative dendrimer technology. DEP® SN38 is Starpharma’s priority clinical-stage DEP® asset for licensing. The Company commercializes its development pipeline with corporate partners through licensing, sales, and distribution agreements at various stages in a product's development lifecycle, depending on the product, patent opportunity, a partner's commercial strategy, and relative strength of product and market expertise, and comparison of current and future potential returns. On 22 Jan’2024, Starpharma signed a sales and distribution agreement for its VivaGel® BV product with ITROM Pharmaceutical Group. Under the agreement, Starpharma will manufacture and supply VivaGel® BV, and ITROM will be responsible for sales, distribution, and marketing in the MENA region. Starpharma expects a phased launch plan across the region in FY25. On 8 Apr'2023, the company executed a strategic partnership with Medicxi to co-found a new UK-based company called Petalion Therapeutics Limited ("Petalion"). Starpharma will license certain intellectual property ("IP") to Petalion as required for the research, development, manufacture, and commercialization of potential new therapeutics in Oncology, and in exchange, will receive an equity holding of 22.5% in Petalion.

Demonstrated clinical validation of its DEP® technology

During the year (FY24), Starpharma announced results from its three Phase II clinical trial programs – DEP® SN38 (DEP® irinotecan), DEP® cabazitaxel, and DEP® docetaxel. All three programs provided clinical validation of the DEP® technology; over 350 patients have now been treated using DEP® products. These trials have shown promising anti-cancer activity and improvements in efficacy, including longer median progression-free survival (mPFS) and higher overall survival (OS) rates than published data on standard-of-care regimens. The DEP® products also demonstrated improved tolerability profiles in patients with advanced cancers, including lower rates of severe adverse events, compared with standard-of-care treatments. Importantly, the DEP® treatments extended the lives of many patients who had failed other therapies and allowed many to live more fulfilling and enriched lives. The company also confirmed plans to progress Starpharma’s DEP® HER2 radiodiagnostic program towards a first-in-human clinical trial, following promising early-stage imaging data in HER2-positive (HER2+) cancers. This dendrimer technology bridges the gap between small molecules and large antibodies, offering the potential to improve performance and overcome limitations associated with existing technologies and treatments.

In FY24, Starpharma reported the results from the Phase II trial of DEP® SN38, with promising data generated in advanced colorectal cancer and platinum-resistant ovarian cancer indications. DEP® SN38 is a patented nanoparticle formulation of SN38, which is the active metabolite of the anticancer drug irinotecan. The DEP® SN38 Phase II clinical program met its objectives, with endpoints demonstrating positive anti-tumour efficacy in heavily pre-treated patients with a range of difficult-to-treat, advanced, metastatic cancers, including colorectal cancer and platinum-resistant ovarian cancer. DEP® SN38 demonstrated clinically meaningful improvements in efficacy, as measured by progression-free survival and objective responses when compared to published data on standard-of-care treatment options. The trial also confirmed the product’s favorable safety and tolerability profile. There was a notable lack of severe gastrointestinal adverse events and no instances of cholinergic syndrome, which are both commonly associated with standard irinotecan. These positive efficacy and tolerability results support the promising clinical utility and potential commercial opportunities for DEP® SN38 in the treatment of advanced colorectal cancer and platinum-resistant ovarian cancer. Starpharma is prioritizing the licensing of DEP® SN38 because of its potential to address significant unmet needs in advanced colorectal and platinum-resistant ovarian cancers.

In FY24, the company announced the final positive results from its completed Phase 2 open-label clinical trial of DEP® cabazitaxel. DEP® cabazitaxel is a patented, dendrimer nanoparticle version of cabazitaxel (Jevtana®), which is widely used in the treatment of prostate cancer, with Jevtana® achieving peak sales of €433 million in 2021. The trial met its objectives, with endpoints demonstrating positive anti-tumor efficacy of DEP® cabazitaxel in advanced, metastatic castrate-resistant prostate cancer (mCRPC), as well as other difficult-to-treat cancers, including platinum-resistant ovarian cancer and gastro-oesophageal cancers. The trial results also confirmed the favorable safety and tolerability profile of DEP® cabazitaxel. Importantly, DEP® cabazitaxel was also well tolerated, with almost 90% of the treatment-related adverse events (AEs) being mild or moderate, and very few severe AEs. The final clinical data from the DEP® SN38 and DEP® cabazitaxel Phase I/II clinical trials were showcased at the 2024 ASCO Annual Meeting through oral podium presentations. These promising efficacy results in advanced prostate, ovarian, and gastro-oesophageal cancers have created a significant market opportunity for DEP® cabazitaxel.
In FY24, Starpharma reported Phase II results for DEP® docetaxel. DEP® docetaxel is a dendrimer nanoparticle formulation of the chemotherapy drug docetaxel (Taxotere®). The DEP® docetaxel Phase II clinical program met its objectives, with endpoints demonstrating encouraging anti-tumour activity in multiple advanced, metastatic cancers, including pancreatic cancer, gastro-oesophageal cancer, non-small cell lung cancer, and cholangiocarcinoma. The safety and tolerability of DEP® docetaxel were also confirmed. The company remains open to proposals from parties interested in further developing this candidate. DEP® docetaxel represents an important part of Starpharma’s mission to improve cancer therapy delivery using its advanced dendrimer technology.

Received positive feedback from the FDA on DEP® SN38 clinical pathway for platinum-resistant ovarian cancer

On 19th Dec’2024, the company announced a positive development regarding its DEP® SN38 (DEP® irinotecan) program following a meeting with the US Food and Drug Administration (FDA). DEP® SN38 is Starpharma’s priority clinical-stage DEP® asset for licensing. DEP® SN38 has demonstrated highly encouraging anticancer results in a Phase 1/2 study in patients with a range of advanced cancers, including colorectal and platinum-resistant ovarian cancer (PROC). The purpose of the meeting was to confirm the regulatory approval pathways and seek regulatory guidance on the design of a Phase 2/3 clinical program aimed at obtaining registration for DEP® SN38 in patients with platinum-resistant ovarian cancer in the US. The FDA agreed with Starpharma’s proposal that DEP® SN38 could be considered for FDA Fast Track designation, acknowledging that platinum-resistant ovarian cancer is a serious condition with significant unmet medical need. The FDA also agreed that a “505(b)(2)” regulatory approval pathway is appropriate for DEP® SN38, as the product delivers the active moiety of the FDA-approved drug, irinotecan (Camptosar®). The 505(b)(2) pathway allows Starpharma to utilize existing FDA findings of safety and efficacy for an already approved drug, potentially streamlining the approval process by removing the need for some additional studies. The FDA indicated that DEP® SN38 may qualify for accelerated approval based on an interim analysis of early surrogate endpoints from the proposed Phase 2/3 clinical trial program. The FDA’s feedback provides confidence for an Investigational New Drug (IND) application for DEP® SN38, supporting its ultimate goal of licensing the product.

ACE’s Recommendation:

The Company aims to generate value through the clinical development and commercialization of its proprietary products, as well as partnerships with pharmaceutical and biotechnology companies based on its patented dendrimer technology in pharmaceutical and healthcare applications. Starpharma’s strategy involves three key focus areas to drive growth, extract value from the dendrimer technology, and optimize shareholder returns: 1) maximize DEP® asset value; 2) accelerate early asset development; and 3) build long-term sustainability. During FY24, the company completed three Phase 2 clinical trials for DEP® SN38, DEP® cabazitaxel, and DEP® docetaxel, which have generated significant data and clinical validation for its innovative dendrimer technology. During the year (FY24), Starpharma announced results from its three Phase II clinical trial programs – DEP® SN38 (DEP® irinotecan), DEP® cabazitaxel, and DEP® docetaxel. These trials have shown promising anti-cancer activity and improvements in efficacy, including longer median progression-free survival (mPFS) and higher overall survival (OS) rates than published data on standard-of-care regimens. The DEP® products also demonstrated improved tolerability profiles in patients with advanced cancers, including lower rates of severe adverse events, compared with standard-of-care treatments. On 19th Dec’2024, the company announced a positive development regarding its DEP® SN38 (DEP® irinotecan) program following a meeting with the US Food and Drug Administration (FDA). The FDA agreed with Starpharma’s proposal that DEP® SN38 could be considered for FDA Fast Track designation, acknowledging that platinum-resistant ovarian cancer is a serious condition with significant unmet medical need. The FDA also agreed that a “505(b)(2)” regulatory approval pathway is appropriate for DEP® SN38, as the product delivers the active moiety of the FDA-approved drug, irinotecan (Camptosar®). The FDA’s feedback provides confidence for an Investigational New Drug (IND) application for DEP® SN38, supporting its ultimate goal of licensing the product. We believe that the accelerated regulatory pathways discussed with the FDA for DEP® SN38 will accelerate the path to commercialization. The stock closed the day at A$0.096/share and presents an investment case from a long-term view. So, we would like to recommend a SPECULATIVE BUY rating on the stock.

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