Cizzle Biotechnology plc (LON:CIZ), focused on cancer diagnostics, was spun out of the University of York to exploit the biomarker, variant CIZ1b, for early detection of different forms of lung cancer. There is high medical need for a simple blood test, to be used alongside a positive chest scan, that allows early detection of lung cancer. This should result in a significant reduction in the number of false positives, reduce the number of scans and improve patient outcomes. As part of its portfolio expansion and to increase the number of income streams, Cizzle has signed a commercial and royalty deal with respect to a clinical asset, known as AZD1656.
- Strategy: Cizzle Biotechnology is a diagnostic company that is progressing a biomarker diagnostic assay, which aims to deliver a simple blood test for lung cancer that can pick up the disease earlier to improve the chances of survival, and to greatly reduce the need for unnecessary follow-up tests and tissue biopsies.
- SGSC: Initially, Cizzle signed an MoU with St. George Street Capital (SGSC), a UK-based medical charity, to develop a companion diagnostic for one of its clinical assets, also with the potential to earn royalties. This has evolved into two deals, with the commercial and royalty deal signed, giving potential royalties of up to £5m.
- AZD1656: AZD1656 is a potent and selective activator of glucokinase that was developed initially by AZN for type II diabetes. Now licensed to SGSC, in a recent ARCADIA trial in 150 diabetic patients with COVID-19, AZD1656 was shown to have promise and be worthy of further late-stage development.
- Risks: Cizzle is a small company with a single asset and limited resources. Portfolio expansion through partnerships is expanding its income opportunities and reducing the risk, but success is dependent on further partnerships and out-licensing deals being signed, which can take time to be concluded.
- Investment summary: Since Cizzle Biotechnology’s listing, its shares have drifted while the market awaits news. Over the past few weeks, Cizzle has announced two new collaborations, which have the potential to expand the number and timing of income streams. Trading on an EV of just £11.5m, the market seems to be ignoring these deals, which suggests that Cizzle has considerable upside potential when investors become aware of these and as development progress is made.
