Fund manager James McDonald at the Pengana High Conviction Equities Fund provides insight into some of the current opportunities arising for the Fund.
In particular, James explains why stock example Immutep is very well placed to benefit from the current environment and how it fits in the portfolio structure. With a targeted portfolio made up of less than 20 stock holdings, Immutep is one of the stocks held by investors in the Pengana High Conviction Fund and is one of our top performers which we are very excited about.
The Fund first invested in this company in November last year when the share price was $0.25. It’s now about $0.53, which is pleasing. The company had a very small market value compared to the Revenue opportunity.
Their main drug Eftilagimod, is unlicensed, which makes the company an attractive acquisition target. It has encouraging clinical data in three indications. Breast cancer, lung cancer, and head and neck cancer.
It’s partnered with two of the world’s largest pharmaceutical companies, Merck USA and Merck Kgab, Germany, to conduct joint clinical studies, both of whom could be potential acquirers of the company. Recently Bristol Myers Squibb recorded positive phase three data with a similar class of drug which has created a great deal of interest in this sector.
About two months ago, the FDA granted fast track approval, for FD in head and neck cancer, which will accelerate the speed at which the drug could get approved. It’s about a $2 billion market opportunity, so very substantial in its own right even without considering the other indications. We’ll continue to get more data on this drug over the next 12 months, which could see substantial value unlocked.