Cowan updates their report on Immunocellular Therapeutics ($IMUC)

Immunocellular Therapeutics ($IMUC) is a Los Angeles-based clinical-stage company that is developing immune-based therapies for the treatment of brain and other cancers. The Company recently commenced a Phase II trial of its lead product candidate, ICT-107, a dendritic cell-based vaccine targeting multiple tumor associated antigens for glioblastoma.

Cowan and Company updated their research report to "Neutral (2)":

"Earnings reported; valuation has gotten rich, we remain on sidelines.

Cowan Summary: Through its 10K filing, IMUC reported 2011 financials and provided a pipeline update. We reiterate our Neutral rating and recommend that investors avoid IMUC shares given:

• Lack of significant newsflow (the only meaningful expected milestone in the next year is the interim Phase II data from the ICT-107 study in GBM, which is expected 1Q13), and especially
• Valuation, which at an EV around $175M seems very rich for a stock whose main asset has produced very limited clinical evidence of its efficacy and safety (single-site, single-trial, single-arm, open-label, non-randomized, uncontrolled, 16-19 patients, etc).

Clinical update: The Phase II trial of ICT-107 in GBM has enrolled 156 patients at 24 U.S. centers. IMUC plans to add more U.S. sites and expects to complete enrollment of ~200 patients in 2Q12. IMUC also plans to submit an IND with the FDA for ICT-121 in 1H12 and to initiate a physician-sponsored, Phase I trial, that will be conducted at Cedars-Sinai and is expected to enroll approximately 20 recurrent GBM patients following resection of tumor and standard of care treatment.

What's next?

• Complete enrollment in Phase II trial of ICT-107 in GBM in 2Q12, 2) initiate a physician-sponsored Phase I trial of ICT-121 in GBM in 1H12, 3) initiate Phase I/II trial of ICT-140 in ovarian cancer in 1H12, 4) report interim data from Phase II trial of ICT-107 in 1Q13, and 5) report final data from Phase II trial of ICT-107 in 3Q13/4Q13.
• Earnings reported. IMUC spent $2.9M ($2M in R&D, $0.7M in SG&A, and $0.2M in stock-based compensation) in 4Q and $8.6M ($5M in R&D, $2.4M in SG&A, and $1.2M in stock-based compensation) in 2011. IMUC ended 2011 with $6.7M in cash and raised $9.3M in net proceeds in a January secondary offering of 9.5M shares at $1.10/share, bringing its pro-forma cash position to approximately $16M or $0.26/share in cash. According to the company, current cash is sufficient to fund operations through the end of 2013.

Cowan Contacts:

Simos Simeonidis, Ph.D.

(646) 562-1386 simos.simeonidis@cowen.com

Yatin Suneja

(646) 562-1388 yatin.suneja@cowen.com

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