OXB is a specialist advanced therapy viral-vector biopharmaceutical company. It offers vector manufacturing and development services, while retaining proprietary drug candidates. OXB will also receive royalties on commercial products developed with its LentiVector® platform. The first half of 2018 delivered significant growth in gross income, primarily through licensing income on signing new partnership deals with Axovant Sciences (AXON) and Bioverativ (BIVV). OXB out-licensed its proprietary Parkinson’s gene-therapy to AXON in a $842.5m deal, and the $105m BIVV deal is for haemophilia gene-therapy development.

  • Strategy:  OXB has four strategic objectives: delivery of process development (PD) services that embed its technology in partners’ commercial products; commercial manufacture of lentiviral vector; out-licensing of proprietary candidates; and investment in R&D and the LentiVector platform.
  • Interim results: Excellent progress in signing strong partnership deals boosted gross income (sales and other income) by 118% to £36.0m in the six months to June 2018. This was the first period that OXB received royalties (undisclosed) from Novartis, demonstrating pull-through from the partnering strategy.
  • EBITDA positive: 1H’18 was the first period that OXB has been EBITDA positive, with earnings up 522% to £9.4m (-£2.2m). Irregular payments of licensing income will underly lumpy profitability in the next three years. Underlying EPS is expected to be in the region of 15.7p for the full year.
  • Manufacturing expansion: In March, OXB raised £20.5m gross (ca.£19.3m net) via a Placing of 174.4m (3.49m after 1-for-50 consolidation) Ordinary shares, at a price of 11.75p (587.5p) per share. The planned use of proceeds is investment in new facilities to meet the growing demand for vector bioprocessing.
  • Investment summary: OXB is at a very interesting juncture. Heavy investment in state-of-the-art GMP manufacturing facilities for production of gene-therapy vector has resulted in supply agreements with Novartis, Bioverativ, AXON, and in Cystic Fibrosis, on top of existing partnerships – positioning the group on the road to significant bioprocessing service income, milestones, and royalties.