We initiate coverage of Vicore Pharma with an OUTPERFORM recommendation and a TP of SEK43, nearly three times the current share price. Vicore is a clinical-stage Swedish biotech company focused on fibrotic orphan diseases. The key driver is lead asset C21, a highly selective small molecule agonist of the angiotensin II type 2 receptor (“AT2R”), in development for idiopathic pulmonary fibrosis (“IPF”), a rapidly progressing, fatal lung disease with few, sub-optimal treatment options that nevertheless generated c.$1.8bn in 2017E sales. C21 is due to start a Phase IIa proofof-concept trial in IPF in April / May and could enter a pivotal trial in 2020E, paving the way for regulatory approval in 2023E. We forecast peak sales of c.$1.4bn in 2030E and assume that Vicore enters a licensing deal in 2022E including $1bn in total upfront and milestone payments plus double-digit royalties on sales.
