Mainz Biomed's (NASDAQ: MYNZ) share price weakness presents an opportunity to trade ahead of potential near-term catalysts. Shares dropped on Monday, possibly in sympathy with the Silicon Valley Bank (NASDAQ: SIVB) fiasco. However, while MYNZ does list a Berkeley, California connection on its byline, this company is primarily based in Germany. Thus, financial exposure, if any, is more of a distraction than an MYNZ-specific event. Moreover, its significance is outweighed by the planned data releases expected over the next 90 days.
Remember, all deposits have been guaranteed by the U.S. Government and made available Monday morning. Hence, investors shouldn't expect disruption to cash flow, which is the lifeblood of biotech. In other words, everything at MYNZ has stayed the same. And with contagion the likely cause of its share price decline, paying attention to MYNZ's fundamentals and potential catalysts in the crosshairs exposes an opportunity worth seizing.
A Bullish Set-Up For 1/H 2023
Current MYNZ valuations might be appropriate if there were no forward-looking considerations. But that isn't the case. In fact, considering recent weakness, the value proposition has become more attractive, with intrinsic and inherent asset portfolio considerations supporting a correction to the upside. That bullish sentiment is justified.
Market reactions to the SIVB situation aside, MYNZ is doing the right things at the right time. Furthermore, after successfully completing a $25.8 million public follow-on offering to fuel its initiatives, they are well-positioned to advance an impressive stable of molecular genetics and cancer diagnostics that can alter the diagnostics landscape. And with 2022 paving the way for a shift into hyper-growth, 2023 is expected to be the year when MYNZ scores exponential revenue growth from leveraging the full potential of a diagnostics and screens portfolio that could earn best-in-class designations. The better news is that several data set releases are expected in the first half of this year, which brings with them the potential for share prices to move appreciably higher.
In play are three planned updates. The first relates to launching its U.S.-based eAArly DETECT study to evaluate the performance of its mRNA biomarkers in identifying Advance Adenomas (A.A.), a type of pre-cancerous polyp often attributed to colorectal cancer (C.R.C.). The first patient has been enrolled, and an update on that trial is expected before the end of Q2. Secondly, an update during 1/H 2023 is expected from its ColoFuture trial, a European study evaluating integrating a portfolio of novel gene expression (mRNA) biomarkers into ColoAlert, which could potentially enable the screening test to identify advanced adenomas, a type of pre-cancerous polyp often attributed to C.R.C. Those two events can be significant near-term value drivers, noting that investors typically position ahead of such releases. But there's more to like.
A third value driver could come through its ReconAAsense trial, a U.S. Pivotal Clinical Study with its C.R.C. screening test. Enrollment for that study is expected to commence in mid-2023. Singularly, updates from any of the above can move the valuation needle. Considering that all three intend to release data in the coming weeks, that move has the potential to be significant.
A Differentiated Business Model
Still, that's only some of what to consider when appraising MYNZ. There is value inherent to its continued execution of its differentiated business model of partnering with third-party laboratories for test kit processing versus the traditional methodology of operating a single facility. In addition, MYNZ ramped up international commercial activities for ColoAlert, its highly efficacious and easy-to-use detection test for C.R.C., with at least five new lab partners in Germany and Italy. That's still more to like.
MYNZ achieved multiple preclinical milestones supporting the continued development of PancAlert, a potential first-in-class screening test for pancreatic cancer, acquired a portfolio of novel mRNA biomarkers to upgrade ColoAlert's technical profile to achieve "gold standard" status for A.A. and C.R.C. at-home testing, and, as noted, shored up its finances with a completed $25.8 million capital raise.
With ample cash to fund operations, MYNZ could be in its strongest position to create sustainable shareholder value, including that accrued from overseas market opportunities and those inherent to ongoing product development programs. More directly, while 2022 was a year of milestones reached, 2023 can be transformative, with MYNZ benefiting from an operations tailwind accelerating its mission of becoming a leading provider of cancer-focused early detection and disease prevention molecular diagnostics.
Progress On Several Fronts
Proof of leveraging that momentum is exposed. Last month, Mainz Biomed announced executing its option from Uni Targeting Research AS to acquire all of the previously licensed scientific intellectual property ("I.P.") for its flagship product ColoAlert. That deal makes this highly productive and easy-to-use detection test for colorectal cancer being commercialized across Europe a wholly-owned asset. Simultaneously, Mainz exercised its exclusive option with SOCPRA Sciences Sante et Humaines S.E.C. to outright purchase I.P., including a pending patent, associated with a portfolio of novel gene expression (mRNA) biomarkers that have demonstrated the ability to detect C.R.C. lesions, including advanced adenomas, a type of pre-cancerous polyp often attributed to this deadly disease.
The value inherent to that deal should be considered. In addition to being an immediate value driver from an existing market perspective, it allows MYNZ to aggressively execute its commercial strategy and product development plans intending to bring what the company describes as the gold-standard C.R.C. self-administered diagnostic test to market. Additionally, MYNZ can earn more money since securing complete I.P. ownership expedites the company's growth strategy, streamlines administration, reduces per-test expenses and allows MYNZ to ramp up corporate development activities. These initiatives add to existing revenue streams.
Mainz Biomed is already commercializing ColoAlert across Europe and in select international markets through partnerships with third-party laboratories for test kit processing. The terms are accretive to MYNZ's mission: Mainz Biomed provides ColoAlert to the respective labs, including co-branding with key accounts, whereby each facility purchases Mainz Biomed's customized polymerase chain reaction ("PCR") assay kits on an on-demand basis. That reach extends to those facilities' respective networks of physicians and patients, which by using ColoAlert, offers a comprehensive solution for advanced C.R.C. detection.
Enhancing Already Excellent Assets
Mainz is doing more. They are also evaluating the mRNA biomarkers acquired from SOCPRA in ColoFuture and eAArly DETECT, an international multi-center clinical study (U.S. and Europe) assessing the potential for integrating the mRNA biomarkers into ColoAlert. This particular portfolio of mRNA biomarkers selected by Mainz Biomed was based on work in the field by the University of Sherbrooke, where researchers tested multiple novel transcriptional biomarkers using colorectal cancer and pre-cancerous lesion samples.
Results from these studies demonstrated that the mRNA targets chosen by the company provided a dynamic combination of sensitivity and specificity of detection. The ColoFuture study (extended into the U.S. as eAArly DETECT) is evaluating the effectiveness of these biomarkers to enhance ColoAlert's technical profile to expand its capability to identify A.A. while increasing ColoAlert's rates of diagnostic sensitivity and specificity. As noted, ColoFuture's eAArly DETECT study is on track to complete enrollment in the first quarter of 2023, with results also expected in the first half of 2023. That milestone, once reached, could become a catalyst.
Remember, too, that studying mRNA biomarkers is a hot sector. Both Pfizer (NYSE: P.F.E.) and Moderna (NASDAQ: MRNA) are investing considerable resources in appraising their value in a new generation of medicine. MYNZ is also in the game, noting that the outcome of its eAArly DETECT study will inform its decision of whether to integrate the biomarkers into the ReconAAsense study, which is on track to enroll patients in the summer of 2023. The results from that study are planned to be reported in 2025, forming the basis of the data package to be reviewed by the F.D.A. to achieve marketing authorization.
Also, in February, MYNZ announced additional commercial partnerships for ColoAlert with Marylebone Laboratory and Instituto de Microecologia, two leading independent laboratories covering England and Spain. That deal will expand MYNZ's revenue-generating reach and target an addressable market in Spain estimated at 26 million patients and a London-region patient treatment opportunity of roughly 9 million individuals. Revenues from that deal could accrue quickly. MYNZ says they are working on completing the necessary technical and co-marketing activities to ensure a successful commercial launch in these markets.
A Bullish Proposition That Is Portfolio Supported
All told, while each asset is impressive, the sum of MYNZ's parts presents a valuation disconnect too good to ignore. And at current prices, investors may only get a short window of opportunity, which could close once investors realize that MYNZ is ideally positioned to accelerate its multi-pronged initiatives. Moreover, fundamentally, MYNZ is solid. They have a strong balance sheet, minimal debt, and a Who's Who executive and scientific team executing a plan to develop, market, and maximize value-generating opportunities.
Thus, with MYNZ already expediting an ambitious agenda, they are less of an "if" than a "when" proposition regarding value drivers in the queue. And with the groundwork laid and guidance to expect three updates by the end of Q2, the question of "when" can be answered by the term: imminently. Remember, MYNZ guidance suggests that catalysts are more than a target; they are in the crosshairs. And with precedent showing MYNZ delivers as expected, taking advantage of a valuation disconnect ahead of updates may, therefore, be a wise and timely consideration.
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