Mainz Biomed's (NASDAQ: MYNZ) value proposition keeps getting stronger. Last week, they announced another deal to expand the marketing reach of its flagship ColoAlert diagnostic. This one is with Germany-based Labor Staber, a leading diagnostics services lab with over 800 employees, including almost 100 medical specialists, biologists, chemists, and other academics from various disciplines. Under the terms of the deal, ColoAlert, a highly efficacious and easy-to-use at-home screening test for colorectal cancer (CRC), will be marketed through Labor Staber's extensive network of physicians and laboratories.
From an investors standpoint, it can be considered as another accretive deal accelerating MYNZ's mission to save lives through the early detection of CRC, the third most common cancer globally, by increasing consumer access to affordable and reliable CRC screening tests like ColoAlert. While the deal is a near-term value driver, it's not the only one. MYNZ has entered multiple mutually beneficial partnerships with diagnostic labs that expedite revenue-generating potential from putting its PCR testing kits in the hands of highly professional laboratory networks.
In other words, MYNZ is facilitating a business model that combines the strength of global marketing partnerships for a stated purpose: grow its consumer reach and create sustainable shareholder value.
ColoAlert Is The Flagship Value Driver
ColoAlert, MYNZ's highly sensitive and user-friendly at-home colorectal cancer screening kit, is fueling recent growth. It's a non-invasive test that can indicate tumors as determined by analyzing tumor DNA and demonstrates better early detection than fecal occult blood tests (FOBT). In fact, based on PCR technology, ColoAlert detects more cases of colorectal cancer than other stool tests and allows for an earlier diagnosis, which is a driving factor in MYNZ's ability to attract marketing partnerships with independent companies throughout the EU to commercialize the best-in-class screen. But MYNZ isn't strictly focused on the market opportunities in the EU.
They are seeking marketing approval in the US, noting that ColoAlert will be evaluated in the FDA-registration trial 'ReconAAsense.' Once approved in the US, MYNZ's commercial strategy is to establish scalable distribution through collaborative partner programs with regional and national laboratory service providers nationwide. It intends to leverage its proven business model to penetrate the massive income-producing markets inherent to US commercialization and distribution. A better test is needed, and MYNZ is answering that call.
According to World Cancer Research Fund International, colorectal cancer is the third most common cancer globally, with more than 1.9 million new cases reported in 2020. The US Preventive Services Task Force recommends that screening with stool DNA tests such as ColoAlert should be conducted once every three years starting at age 45. Notably, while over 16.6 million colonoscopies are performed in the US annually, roughly one-third of residents aged 50-75 have never been screened for colon cancer. This gap in screening represents a $4.0B+ total market opportunity in the US, and MYNZ is seizing on that disconnect.
Positioned To Accelerate Growth In 2023
The company successfully completed a $25.8 million public follow-on offering to fuel its initiatives, positioning them ideally to advance its impressive stable of molecular genetics and cancer diagnostics that can alter the diagnostics landscape. The capital raise was accrued with a purpose, most notably preceding several data set releases expected in this year's first half. Each brings the potential to support an appreciable move higher for its share price.
At least three updates are planned. The first relates to launching its U.S.-based eAArly DETECT study to evaluate the performance of its mRNA biomarkers in identifying Advance Adenomas (AA), a type of pre-cancerous polyp often attributed to colorectal cancer (CRC). 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 CRC 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 US Pivotal Clinical Study with its CRC 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 Expedites Growth
There's more to the MYNZ value proposition, created by its differentiated business model of partnering with third-party laboratories for test kit processing versus the traditional methodology of operating a single facility. It led to MYNZ ramping up international commercial activities for ColoAlert, now benefiting from at least five new lab partners in Germany and Italy. There's more to factor in.
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 AA and CRC at-home testing, and, as noted, can expedite its comprehensive mission after completing its $25.8 million capital raise.
The sum of those parts puts MYNZ 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 goal of becoming a leading provider of cancer-focused early detection and disease prevention molecular diagnostics.
Proving Its Portfolio Value
Steps toward reaching that goal continue. Last month, Mainz Biomed announced executing its option from Uni Targeting Research AS to acquire all of the previously licensed scientific intellectual property ("IP ") 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 SEC to outright purchase IP, including a pending patent, associated with a portfolio of novel gene expression (mRNA) biomarkers that have demonstrated the ability to detect CRC lesions, including advanced adenomas, a type of pre-cancerous polyp often attributed to this deadly disease.
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 CRC self-administered diagnostic test to market. Additionally, MYNZ can earn more money since securing complete IP 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.
Remember, 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 strategically accretive: 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 CRC detection.
Trials To Make Excellent Products Even Better
Mainz is doing more to create value by working to make its already excellent diagnostics better. They are evaluating the mRNA biomarkers acquired from SOCPRA in ColoFuture and eAArly DETECT, an international multi-center clinical study (US 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 US as eAArly DETECT) is evaluating the effectiveness of these biomarkers to enhance ColoAlert's technical profile to expand its capability to identify AA 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: PFE) 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 FDA to achieve marketing authorization.
Also, last month, MYNZ announced adding commercial partnerships for ColoAlert with Marylebone Laboratory and Instituto de Microecologia, two leading independent laboratories covering England and Spain. That deal expands MYNZ's revenue-generating reach and targets 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 from MYNZ already working on completing the necessary technical and co-marketing activities to ensure a successful commercial launch in these markets.
A Bullish Setup For 1/H 2023
Considering everything in play, especially the updates that could turn milestones reached into catalysts, MYNZ stock is an attractive value proposition. Analysts agree. Cantor Fitzgerald initiated its coverage with an Overweight recommendation noting MYNZ's prospects in colorectal cancer screening. They modeled a $15 price target, a more than 135% increase from current levels that could be reached sooner than later if the company earns US marketing approvals. They aren't the only ones expressing a bullish sentiment. Jones Research expects MYNZ can score $11 a share based on risk-adjusted discounted cash flow (DCF) valuation with cash flows forecasted through 2034; they assume a probability of success of 90% for ColoAlert in the US.
Most important, both believe the valuation disconnect between MYNZ's assets and inherent potential could quickly, not only from marketing potentials but through 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, MYNZ creating potentially significant shareholder value may not be an "if" proposition but a "when." And with MYNZ providing regular updates and analyst opinions supporting the bullish thesis, the answer looks quite visible: faster than many think.
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