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Sunday, September 25, 2022

Galectin Runners Bioxytran Inc (OTCMKTS: BIXT) & Galectin Therapeutics (NASDAQ: GALT) Breaking Out

One of the most exciting advances in biotechnology is the galectin inhibitor. Galectins are key proteins implicated in a wide range of chronic diseases. The leading companies in galectin science have made some significant moves over the summer that investors should be watching.  There seems to be a renaissance in the shares of both  Bioxytran Inc. (OTCMKTS: BIXT) and Galectin Therapeutics (NASDAQ: GALT).  Both companies have similar market caps of around $120 million and both have galectin antagonists.  The other similarity is that both companies have molecules that were designed by Dr. Platt, CEO of Bioxytran who is the top carbohydrate chemist in the world and responsible for 5 clinical-stage galectin inhibitors.  BIXT recently announced the release of a medical journal article that was highly technical and showed that multiple receptors could be targeted simultaneously.  In a recent video interview on Emerging Growth with the EVP of Bioxytran, there were clues that their existing molecules may be targeting multiple galectins.  The EVP is a self-proclaimed galectin evangelist who speaks passionately about galectin science and has written a number of galectin science-related posts on Seeking Alpha.

Targeting Many Disease Indications

There are actually three public companies in the Galectin space. The third one is Galecto Biotech (NASDAQ: GLTO); they are developing two galectin antagonists, and their primary indications are Idiopathic Pulmonary Fibrosis (IPF) and cancer.  GALT’s focus is NASH cirrhosis and cancer, but they have also done clinical studies in psoriasis and atopic dermatitis, as well as some preclinical work in arrhythmia. BIXT’s focus is on acute COVID-19 with their oral tablet and pulmonary fibrosis with their intravenous (IV) formulation.  These three companies do have a healthy amount of crossover between the indications.  Both GALT and GLTO are working on cancer and both BIXT and GLTO are working on pulmonary fibrosis.

https://www.youtube.com/watch?v=dKQbI1dWp_g

Galectin Challenge Highlights Platform Potential

Regardless of what disease these companies are targeting, the one constant that remains is that their primary druggable target is Galectin-3.  All of these galectin science-based companies are targeting Galectin-3 but in different ways.  BIXT has both an oral tablet version which is highly commercially desirable compared to an IV.  GALT’s Belapectin is only delivered intravenously, and GLTO has an inhaled version and an oral version. GALT and BIXT use complex carbohydrates to antagonize galectin-3, and GLTO has a small synthetic chemical.

In a webcast, the EVP of BIXT challenged any investor to stump him and name a chronic disease that didn’t have a journal article linking Galectin-3 to the chronic disease. The bottom line is that there are almost countless chronic diseases where medical journal articles all basically conclude the same thing: the journal publications say that galectin-3 is a biomarker of disease, that it predicts mortality, that galectin-3 drives a disease, or that a galectin-3 inhibitor is an attractive or even ideal target to treat the chronic disease.  These chronic diseases include a wide variety of cancers, nonalcoholic steatohepatitis (NASH), Parkinson’s, Alzheimer’s, heart disease including arrhythmia, myocardial infarction (heart attack) and heart failure, kidney fibrosis (chronic kidney disease and acute kidney failure), psoriasis, diabetes, Chron’s disease, ALS and the list goes on and on, especially with inflammatory, autoimmune, and fibrotic (scarring) conditions.

Bioxytran Breaking Out Following Galectin Therapeutics Big Move

Investors took note of the massive potential for galectin inhibitors this year as GALT received a $60 million funding commitment from its billionaire Chairman of the Board, Richard Uihlein. After BIXT’s webcast last week, investors further realized that perhaps BioXyTran had just as much potential, if not more due to its ownership of what are likely best-in-class galectin inhibitors as well as a shorter pathway to approval with its COVID-19 antiviral which is both a galectin inhibitor and a viral entry inhibitor (a type of antiviral) for COVID-19. BioXyTran also saw funding flowing into as the company raised over half a million at $0.43, which has been well received with the stock moving all the way over $1.00. The difference in strategy is that BioXyTran is running inexpensive, short trials for its COVID drug while Galectin Therapeutics has to run a multi-year long phase 3 trial for NASH cirrhosis, which requires a lot more capital, though it is a big market.

BIXT is currently trading at $1.01 and broke out with strong volume at the $0.75 resistance area.  Typically these breakouts double in price but the volume is quite heavy indicating quite a lot of accumulation.  The other pattern of note is a very strong ascending triangular consolidation period of 8 months.  That last run in December 2021 basically went 10x so a 3-4x run this time might be possible given some of their underlying fundamentals.  The stock is very strong and behaving like an IPO after over 2 years of no press releases so there is a lot of pent-up demand and no supply because they have a very clean structure without toxic debt, and there have been few sellers of the stock. Insiders own around 85% of the company and there is only 11 million shares in the float. The Level 2 market makers are thin and there are no toxic sellers.  The company has fixed convertible notes and at least 6 more months before the restrictions wear off.

Galectin Therapeutics on the other hand is trading at $1.97 and sitting just above its support level. It too blasted through resistance on good volume at the $1.86 level and took off higher.  Right now it is consolidated and retesting the breakout level and had a very nice bounce right off support.  The stock is poised to make another leg higher and the strength of the move by the market leader BIXT could spill over into GALT.

Drug Development Strategy and Company Comparison

The company with the longest development track record is GALT.  They have been developing Belapectin for NASH cirrhosis since 2010 and have enrollees in their pivotal phase 2/3 adaptive trial. Their phase 2/3 trial has a very robust trial design with easy-to-meet practical, clinically relevant endpoints, with a primary endpoint of preventing esophageal varices, which was met with statistical significance in their phase 2 trial.  The trial is overdesigned and sure to pass regulatory scrutiny but it reads out in 2024.  Galecto had done a number of clinical trials; one was completed in IPF, and two are ongoing liver cirrhosis and cancer (NSCLC).  Bioxtran is preparing for a phase 3 trial in India for acute COVID using Prolectin-M and a phase 1/2 trial of Prolectin-I for pulmonary fibrosis if they receive funding. The best analogy that compares the tech was on the Emerging Growth webcast where the EVP of Bioxytran indicated the first galectin inhibitors to make it to the clinic were like World War II fighter aircraft, but the new ones in the BIXT pipeline were like 5th generation fighters.

Risks and Rewards

Each of these galectin companies comes with risk. The primary risk with Galecto is its drug safety which can be significant with drug combination trials like they are doing in cancer, and also with small molecules. There’s also a risk of pharmacokinetic profiles and achieving a therapeutic effect as small molecules can have short half-lives, being broken down by the body. BioXyTran poses funding risks as the company is very lean and operates with a tight budget and executives who forgave over a million in accrued payroll debt to clean up the balance sheet because they so strongly believe in their company. The risk with Galectin is that the company is slow to complete its clinical trials and capitalize on the platform potential of its Galectin-3 inhibitor, currently only running two clinical programs when it should be running more promising programs, especially with the strong cancer data they have been able to amass.

Arguably the company with the best short-term and long-term upside is BioXyTran with its best-in-class galectin antagonist assets as well as the fact that it owns an oxygenation platform that mimics the way oxygen transport is performed in the body and could be a replacement for blood transfusions, as well as a major sea change in how strokes are treated as the drug, can pass through blood clots. BioXyTran also might be the first company to receive regulatory approval as the COVID-19 antiviral, Prolectin-M, has a rapid development pathway. There appears to be a good reason why investors are paying a premium for BIXT shares.

Galecto might be the most undervalued stock at this point in time with only a $58 million market cap, but investors clearly understand that this is because their lead asset is an inhalable drug, making it only important for lung applications, whereas IV and oral galectin-3 inhibitors have the potential to go on and receive label expansions for additional indications across the human body. Heart, liver, and kidney chronic disease applications are all large markets and these give GALT and BIXT stocks a bit more long-term upside in investors’ minds.

However, it makes sense to own all of these galectin stocks as to spread out risk and participate in the trend of galectin-3 antagonists being developed for these chronic diseases.

Bottom Line

The galectin stocks appear to be moving in tandem.  The BIXT webcast may have really excited some investors and the recent money pouring into galectin science has investors thinking big. On the webcast, the clinical trial results were explained—that patients had complete viral elimination of COVID-19 in 3 days and this was shown in a peer-reviewed journal article and was statistically significant!  BIXT compared the 3 days for complete viral elimination versus the 15 days it took Biden to get better on Paxlovid.  They basically have a Paxlovid buster and Paxlovid got the biggest single order ever with $5.3 billion in sales.  The only problem with BIXT is that they have to raise money for a clinical trial but that should be easy given how the money is flowing.  Money is the primary risk because they nailed statistical significance in their first trial.  Now, if you are in the camp that COVID-19 is over there was a surprise in a post from the CEO of BIXT captured in this tweet. Spoiler alert, if you are still paying attention and click the link prepare to sit down. Talk about connecting the dots. So you’ve got a billionaire investing in Galectin science, a galectin evangelist dumbing down the potential of the drugs, and frenzied investment creating the ideal chart for a massive short squeeze.  Blue sky on BIXT at $1.75. The risk-reward looks good.

We will be updating on BIXT and GALT when more details emerge so make sure you are subscribed to Microcapdaily so you know what’s going on with BIXT and GALT

Disclosure: we hold no position in BIXT or GALT either long or short and we have not been compensated for this article.

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