Is Iovance Biotherapeutics Stock a Millionaire Manufacturer?

The biotechnology industry has been described as the Wild West of the stock market. Although some companies succeed in developing and commercializing a life-changing therapy, countless other startups inevitably fail. Still, the risk could be worth it if a blockbuster new drug creates massive wealth for shareholders.

Although this level of success is only evident in hindsight, Iovance Biotherapy (NASDAQ:IOVA) is an emerging industry leader with significant potential. The company’s tumor-infiltrating lymphocyte therapy (TIL) is considered a breakthrough treatment for a wide range of cancers, underscoring the appeal of the stock.

Could buying Iovance stock make you a millionaire? Here’s what you need to know.

Therapeutic breakthrough Iovance TIL

This has been a landmark year for Iovance Biotherapeutics. In February, the company received accelerated approval from the Food and Drug Administration (FDA) for lifileucel. The treatment, marketed as Amtagvi, is the first cellular therapy of its kind to be approved for solid tumor cancers and advanced melanomas.

TIL therapy stands out for its unique mechanism of action. It starts by harvesting T cells directly from the patient’s tumor. This is important because no two tumors are the same, and it allows the therapy to enhance the body’s natural response against cancer with patient-specific immune targets.

From an extracted tumor sample, Iovance manufactures a personalized TIL monotherapy, which is returned to the patient as a single intravenous infusion. The clinical data was impressive, demonstrating Amtagvi’s durable response and ability to prevent cancer from getting worse, particularly in patients with advanced melanoma who have previously not benefited from alternative immunotherapies.

Iovance estimates that the initial potential market is 30,000 patients per year, but that more than 70,000 patients could benefit each year thanks to an expanded indication for all first-line advanced melanomas, currently in phase 3 trials.

Image source: Iovance Biotherapeutics.

Iovance’s pipeline includes applications of lifileucel in separate Phase 2 studies in non-small cell lung cancer (NSCLC), which could be an even larger prize for the company given the global patient population much more important. Longer term, endometrial cancer is also an area of ​​development.

Overall, there is much to like about Iovance, which has taken the crucial step of transforming a clinical-stage biotechnology to bring a new therapy to market. The company nevertheless has a lot of work to do to confirm the viability of its business model.

Reasons for caution

The good news for investors is that Iovance is now generating real sales, with runway for adoption in the oncology market. In the third quarter, total revenue reached $59 million, up from less than $500,000 in the year-ago quarter, as patients’ uptake of Amtagvi accelerated since the drug’s approval. medicine.

For full year 2024, Iovance forecasts total revenue of between $160 million and $165 million, nearly tripling to a target range of $450 million to $475 million in 2025, the first full year of Amtagvi sales.

At the same time, Wall Street analysts forecast a loss of $1.30 per share this year, which would narrow slightly to a loss of $0.82 per share in 2025. Ongoing research and development and heavy Spending to support global expansion will remain elusive.

So while Iovance’s long-term growth is exceptional, the market starting to focus on metrics like margins and cash flow could be a financial headwind that keeps the stock volatile. The other risk investors must balance is the possibility of disappointing clinical data that would force a reset of the company’s outlook.

IOVA EPS estimates for current fiscal year data by YCharts.

An overview for investors

Iovance Biotherapeutics shows great promise in what could still be the early stages of a major growth opportunity. Will the stock evolve into a multi-bagger with the type of returns that can set investors up for life? This remains to be seen and there are great uncertainties.

I believe this future is possible, but it may take many years for it to come to fruition. Iovance will need to demonstrate its ability to enter new oncology categories beyond melanoma. If you are confident in this outlook, you might consider taking a small position in the stock (within a diversified portfolio). But Iovance at least deserves to be on your radar, so you can keep up with the many developments expected in store.

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Dan Victor has no position in any of the stocks mentioned. The Motley Fool posts and recommends Iovance Biotherapeutics. The Motley Fool has a disclosure policy.