Broadfin Capital Increases Its Profitable Stake In Advaxis Inc. (ADXS) To 5.27%

As disclosed in a Schedule 13G filing with the U.S. Securities and Exchange Commission, Kevin Kotler’s Broadfin Capital holds an ownership stake of 1.66 million shares in Advaxis Inc. (NASDAQ:ADXS), accounting for 5.27% of the company’s outstanding common stock. This is up by 849,320 shares since the fund disclosed all of its public equity positions in its most-recent 13F filing submitted a few months ago.

Kevin Kotler

Broadfin Capital is a global equity healthcare-focused hedge fund established by Kevin Kotler in June 2005. The New York-based firm aims to generate attractive long-term compounding returns by employing a value-oriented investment strategy that is based on proprietary fundamental research. Kevin Kotler, the experienced investor in medical technology companies, with more than 20 years of experience, intends to build his hedge fund into a leading investor in healthcare companies. Broadfin Capital’s stock picking approach focuses on finding companies that develop products designed to improve healthcare outcomes and lower costs. At the same time, the investment firm has both the necessary skills and capital to invest across all market capitalizations, ranging from small-cap to large-cap companies. As revealed by the fund’s most recent 13F filing with the SEC, Broadfin Capital manages a public equity portfolio with a market value of $1.28 billion as of March 31, 2015.

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Advaxis Inc. (NASDAQ:ADXS) is a clinical-stage biotechnology company that is currently developing several cancer immunotherapies based on its proprietary Lm Technology. The company’s lead Lm Technology immunotherapy, ADXS-HPV, targets human papillomavirus (HPV)-associated cancers and is currently in clinical trials for three indicators. We’ll discuss Advaxis’ lead product in more detail later on in this article. Meanwhile, the shares of Advaxis have gained nearly 107% year-to-date despite riding a steady downtrend since the beginning of June (read more details).

Let’s now move on to discussing some factors that could explain Advaxis’ soaring stock price during the first half of this year. The biotechnology company is operating in one of the trendiest areas of drug development at the moment: cancer immunotherapy research. Put simply, cancer immunotherapy is the use of the body’s own immune system to fight cancer. Hence, Advaxis is currently developing and testing an engineered bacterium, called Listeria monocytogenes, as a way to train immune systems to fight cancer more effectively. The company has run a few clinical trials aimed at testing this bacterium’s efficiency in treating a variety of cancers. So one of the main reasons the shares of Advaxis skyrocketed during the first half of the year is that the company presented positive clinical and preclinical data on some of its previous studies. Precisely, the company presented positive data on three studies at the American Association for Cancer Research’s annual meeting earlier this year. All three studies displayed positive results on the efficiency of its products.

However, let’s not forget to mention that Advaxis does not have any products on the market at the moment, which actually represents a high risk for current and potential investors in the company. At the same time, Advaxis’ expenses are likely to increase over the next years as the company moves its earlier-phase studies into more costly late-stage phases. Advaxis had $45.94 million in cash and cash equivalents at the end of the fiscal second quarter that ended April 30. Whereas, the company’s research and development expenses amounted to $6.14 million for the quarter, compared to a figure of $3.58 million reported in the fiscal first quarter. Therefore, Advaxis’ expenses appear to be rapidly increasing. However, the company’s potential is massive and some future positive data on its current studies will definitely push the stock even higher.

Considering Kevin Kotler’s expertise in medical technology companies, it is highly likely that Advaxis will deliver positive data on its studies in the upcoming months. In the meantime, Phill Gross and Robert Atchinson’s Adage Capital Management is the most bullish hedge fund on Advaxis Inc. (NASDAQ:ADXS) within our database, holding an ownership stake of 5.14 million shares as of March 31.

Disclosure: None