The rights issue announced on 19 February 2020 is now complete with 90% of the total amount of offered shares subscribed raising a total SEK67m. A positive surprise was the announcement that Nordic life sciences investor Hadean Ventures also decided to invest via a direct private placement of SEK20m. This brings the total amount of new funds to SEK87m gross, which will primarily fund the development of the two core assets for primary mitochondrial diseases (PMD): KL1333, a small molecule NAD+ modulator, and NV354, a succinate prodrug. The most significant share price catalyst in the near term is the KL1333 Phase Ia/b results from the final part of the study, which should start enrolling PMD patients in H220. Our valuation is SEK1.76bn or SEK5.93 per share.
Companies: Abliva AB
In February 2020, NeuroVive announced a rights issue (subject to EGM approval) aiming to raise up to SEK74m gross at a price of SEK0.80 per share, of which 90% (SEK67m) is guaranteed. According to its updated strategy, the main focus will be on KL1333 and NV354 for primary mitochondrial diseases (PMDs), NeuroVive’s area of expertise. Our model suggests this would cover operating costs for 2020 and into 2021. The most significant share price catalyst in the near term is KL1333 Phase Ia/b results, due in H220. Our updated valuation is SEK1.72bn or SEK6.4 per share, which includes the guaranteed amount of the rights issue.
On 9 October 2019, NeuroVive held its capital markets day. Management presented its strategic focus on the company's primary mitochondrial disease programmes, high unmet medical need in this area and advantages of the orphan drug development compared to drugs for common diseases. As expected, no major new details were disclosed. We note an interesting presentation on regulatory perspectives on orphan drug development by NeuroVive’s clinical and regulatory affairs director, Matilda Hugerth. It is not that often investors have straightforward access to expert knowledge about such a specialised topic presented in a clear format. Our valuation is unchanged at SEK1.63bn or SEK8.8/share.
NeuroVive’s core R&D assets in genetic mitochondrial diseases have made steady progress over the past several months. Notable newsflow includes KL1333 proceeding to the second part of its study and NeuroSTAT receiving the FDA’s fast track designation. Potential near-term milestones include initial results from KL1333 Phase Ia/b, a non-dilutive financing solution to enable the start of the NeuroSTAT Phase II clinical trial and an out-licensing of NV556. Our updated valuation is slightly higher at SEK1.63bn or SEK8.8/share.
In February 2019, NeuroVive completed a rights issue, which was followed by a private placement. These brought in a total of SEK108.1m (net estimated), which should be sufficient to 2020. In its recent 2018 annual report, NeuroVive provided a detailed update on its R&D activities and outlined the goals for 2019 achievable with the new funding. Potential near-term share price catalysts include KL1333 Phase Ib initial results, non-dilutive financing and the start of the NeuroSTAT Phase II clinical trial, and an out-licensing of NV556. Our updated valuation is SEK1.51bn or SEK8.1/share.
On 10 December 2018, NeuroVive announced a rights issue (subject to EGM approval) aiming to raise up to SEK123.8m gross at a price of SEK1.35 per share, of which 80% (SEK99m) is guaranteed. Our model suggests this would cover operating costs for 2019 and into 2020, if the total amount is raised. NeuroVive outlined a number of operational goals achievable during this period, while potential share price catalysts include KL1333 Phase Ib initial results, the start of the NeuroSTAT Phase II clinical trial and the planned out-licensing of NV556. Our updated valuation is SEK1.51bn or SEK9.2/share, which includes the guaranteed amount of the rights issue.
On 18 June 2018, NeuroVive announced that it had out-licensed a subset of compounds from its NVP015 programme (succinate prodrugs) to BridgeBio, a private biotech based in California, targeting Leber’s Hereditary Optic Neuropathy (LHON) under new subsidiary Fortify Therapeutics. The upfront payment was limited, but the total deal value could reach $60m. NeuroVive is about to initiate a Phase Ib trial with the second lead drug candidate, KL1333 (NAD+ modulator), while both the EMA and FDA have provided positive views on the lead NeuroSTAT Phase IIb programme (TBI). We value NeuroVive at SEK1.64bn or SEK17.9/share.
On 27 April 2018, NeuroVive announced that the planned rights issue was oversubscribed (104%), delivering SEK78.5m in gross proceeds and funding the operations into 2019. The fundraise allows NeuroVive to focus on the initiation of the NeuroSTAT (traumatic brain injury) Phase IIb trial (H218/H119) and the Phase Ib KL1333 (genetic mitochondrial diseases) trial in Europe (H218). The latter project was bolstered by the recent news from the South Korean partner, Yungjin Pharm, which reported a positive outcome in its own locally run Phase I trial with KL1333. Our updated valuation is SEK1.62bn or SEK17.7/share (SEK18.0/share previously).
NeuroVive’s planned rights issue (subject to approval at the EGM) is expected to bring in a minimum guaranteed amount of at least SEK55m (gross), which would extend the cash reach to 2019 and past several R&D events. Namely, the company will be able to initiate two new clinical trials with both leading assets KL1333 (Phase I) for genetic mitochondrial diseases and NeuroSTAT (Phase II) for traumatic brain injury (TBI). In addition, the company will advance its broad preclinical portfolio, aiming to out-license one of the assets, NV556, for NASH. Our updated valuation is SEK1.44bn or SEK18.0/share compared to SEK1.38bn or SEK26.3/share previously.
NeuroVive has made progress on multiple fronts over the past few months with both its core asset portfolio and non-core projects for out-licensing. Notable developments in the core portfolio include positive feedback from the EMA on the next Phase IIb trial with NeuroSTAT (traumatic brain injury, TBI) and orphan drug designation for KL1333 (genetic mitochondrial diseases) in Europe. Also, the lead compound has been selected in the NVP015 programme for genetic mitochondrial diseases with complex I dysfunction. In addition, investors had a first glimpse of the preclinical data on NVP022, which, together with NV556, targets NASH and both are in portfolio for out-licensing. Our valuation is SEK1.38bn or SEK26.3/share (vs SEK27.0/share previously).
NeuroVive’s recent Q217 report described R&D activities progressing according to plan. The company is preparing for the next clinical studies with the two most advanced assets – NeuroSTAT for traumatic brain injury and KL1333 for genetic mitochondrial disorders. With regard to the portfolio for out-licensing, NeuroVive indicated that discussions with potential partners for NV556 (NASH and liver tumours) will be initiated in the autumn, although partnering is usually a rather lengthy process. We value NeuroVive at SEK1.4bn (SEK27.0/share) vs SEK1.5bn previously.
NeuroVive Pharmaceutical is a mitochondrial medicine specialist with a diversified asset portfolio. It employs a two-pronged strategy and has a portfolio of drug candidates for orphan mitochondrial diseases, which it aims to develop internally; more recently, it has also identified in-house assets suitable to tackle larger indications, which NeuroVive aims to out-license in pre-clinical development. The most advanced projects are Phase IIb ready NeuroSTAT for traumatic brain injury and KL1333 in Phase I for various mitochondrial diseases. We value NeuroVive at SEK1.5bn.
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Although 2020 will probably go down in history as one of the most challenging years experienced during our lifetime, it will also likely be chronicled as one of the best years for the recognition and appreciation of science. As we entered 2020, the COVID-19 pandemic was in its infancy. However, it rapidly evolved through the exponential rise in infections and mortality globally. Much has been achieved during the past 12 months in the fight against COVID-19, but, as we enter 2021, there are considerable concerns about the emergence of a mutant version of the virus and the second wave that we are now facing.
Companies: AVO ARBB ARIX BBGI CLIG DNL FLTA ICGT OCI PCA PIN PHP RECI STX SCE TRX SHED VTA YEW
Q4 trading has led sales to guidance being raised 8%. This has been driven by better than expected UK sales, incl. success with new customers like Wilko/Tesco. Some of the benefit is offset by a non-cash FX debit, but it still leads to an upgrade and higher net cash. As a result of successful trials in Tesco Express, W7 is also being rolled out to 469 more stores. This, and previously announced distribution gains, bodes well for incremental sales/PBT in 2021, and underlines the appeal of its value-for-money brands. On 11x 2019 cash-adjusted EV/EBITDA, valuation is undemanding, particularly with the added attraction of dividends/income.
Companies: Warpaint London PLC
Ongoing strength in the key China market has prompted a positive trading update, indicating FY21 revenues and EBITDA will be significantly ahead of (already upgraded) expectations. Demand for Aivlosin in China in particular has remained strong throughout Q3 and is expected to remain so in Q4. We upgrade our FY21 revenue forecasts by 12% to £91.9m, which flows through to a 30% PBT upgrade to £10.1m. Whilst there is some caution expressed over the sustainability of this demand, we now forecast a flat performance YoY in FY22, but this is still 10% ahead of our previous estimates at the PBT level. The shares remain suspended pending the publication of the delayed FY20 results, which will be released as soon as possible alongside the H1’21 interims.
Companies: ECO Animal Health Group plc
Synairgen (SNG.L): Completion of recruitment for at home trial | Sensyne Health (SENS.L): Research agreement with The Royal Wolverhampton NHS Trust
Companies: Synairgen plc (SNG:LON)Sensyne Health Plc (SENS:LON)
Foresight Group , the award-winning infrastructure and private equity investment manager to IPO on the Main Market (premium). The Offer will primarily comprise a sale of shares by existing shareholders (c.80% of the Offer) with a smaller offering of new shares (c.20% of the Offer) to be issued by the Company. Details TBA. Cornish Metals (TSX-V: CUSN) intends to list on AIM. The Company is proposing to raise £5 million by way of private placement of new Common Shares (the "Fundraising") to advance the United Downs copper-tin project. The Company expects that Admission will become effective in February 2021. The Company's Common Shares will continue to be listed and trade on the TSX-V in Canada. VH Global Sustainable Energy Opportunities plc, a closed-ended investment Company focused on making sustainable energy infrastructure investments, today announces intends to launch an initial public offering of shares on the Official List (Premium) of the Main Market of the London Stock Exchange. Due by Early Feb.
Companies: TYM W7L BEG CRPR EUZ IRR CMCL FARN KETL AUG
ANGLE raised £19.6m (gross) to capitalise on the first-mover advantage that the FDA clearance for Parsortix will create, catalysing ANGLE’s ability to exploit the emerging multi-billion dollar liquid biopsy market. It will enable ANGLE to pursue multiple parallel revenue streams: (i) as a service provider to the pharma industry particularly looking to improve on immunotherapy patient outcomes (companion diagnostics) and (ii) to develop a number of specific clinical applications. Not only does it strengthen the balance sheet ahead of partner discussions but it provides the resources to develop in parallel relevant laboratory developed tests and fund the necessary clinical utility studies that will accelerate clinical adoption. We re-introduce forecasts and raise our target price to 150p (c.£310m EV), which is supported by risk-adjusted DCF and peer group analyses.
Companies: ANGLE plc
Robust FY21 performance forecast, despite pandemic
Companies: SDI Group plc
Cambridge Cognition provided a positive FY 2020 trading update, with revenues (+34%), net losses and cash all ahead of expectations, and delivering an EBITDA-positive Q4. After a year of record order intake (£12.7m) and with a year-end order book of £11.2m (+96% on the prior year), the company is positioned to deliver another year of strong growth. This update provides further evidence of (i) the commercial focus that the CEO has instigated, (ii) the cross-selling opportunities for its newer digital solutions, and (iii) the prospect of a period of sustained strong growth in what are large (c.£1.2bn) and high growth (c.20%) addressable markets for digital solutions for clinical trials. We increase FY 2021 revenues by 18% to £8.5m, implying 26% growth and raise our target price 31% to 105p.
Companies: Cambridge Cognition Holdings Plc
Cambridge Cognition ("COG") has provided a trading update for the year ended 31 December 2020 that is ahead of our expectations. Group Revenues grew +34% to £6.7m (2019: £5.0m) and were +7% ahead of DCe of £6.3m. COG delivered significant revenue growth from digital solutions for clinical trials as it increased its focus on commercialisation. The strong beat in Revenue is due to an improved commercial execution across a wider portfolio of products as the Group has placed a key emphasis on crossselling CANTAB with newer electronic Clinical Outcome Assessment (eCOA) and digital solutions for frequent, remote testing of patients outside of the clinic setting. The Group's order intake for the year closed at a record £12.7m, up +158% on the previous year's order intake of £4.9m and maintaining the growth trajectory reported in the interim results. The Group experienced a mixed effect due to Covid-19 as some orders and revenue recognition was delayed in the year. However, the pandemic has provided an impetus for an industry shift towards evaluating virtual clinical trials, which opened new opportunities for the Group. We move our target price to 89p (from 80p).
Interim results were in line with the 28 October trading update, reflecting the impact of the pandemic, with sales down 27% and LBITDA of £1.3m. However, c.10% LFL growth for Health & Nutrition (HN) in October and November is encouraging and points to long-term growth. Together with confirmation that first shipments against the initial 1m order for AbC-19 rapid antibody tests have taken place as well as first shipments of VISITECT CD4 Advanced Diseases tests to Africa, we expect a strong H2 (c.75% of FY sales), with potential upside driven by a currently poorly visible, yet anticipated long-term opportunity from its three key value drivers: Food Detective in China, VISITECT CD4 and COVID-19 lateral flow devices (LFDs). We leave our forecasts unchanged until we have further clarity on the unfolding COVID-19 opportunities. Whilst this implies c.£9.4m sales in H2, this is still eminently achievable given that supply has the ability to generate in excess of £9m of sales in Q4 FY 2021, should the demand materialise.
Companies: Omega Diagnostics Group PLC
On 30th December 2020, RUA reported that shareholders had approved resolutions regarding the placing along with a strongly oversubscribed Open Offer. RUA now start 2021 with the resources and mandate to accelerate the development of its products, where we anticipate reports of progress during the year. We have slightly increased our R&D and CapEx spend for FY 2022 to reflect this investment and the cash utilization. RUA’s issued share capital now comprises 22,184,797 shares and the increases in FY 2022 investment in its products, modestly change our valuation by about £2.0m to £113.2m for the Company, equating to 510p per share.
Companies: RUA Life Sciences Plc
After an eventful 2020, ReNeuron released updated 12-month Phase ll data in January on its lead human retinal progenitor cell (hRPC) project. This continues to show a consistent and robust, sustained average gain in visual acuity in retinitis pigmentosa (RP). A continuation study in nine patients using two million cells is underway with three- and six-month data due over H2 CY21 and the first three patients treated. This will facilitate partnering negotiations. A pivotal hRPC study may start in 2022. Deals are possible in CY21 on the exosome genetic drug delivery platform, which could be very valuable. The valuation remains at £190m with strong cash.
Companies: ReNeuron Group plc
STX is a commercial-stage company delivering specialty products that address patients’ unmet medical needs, with an initial focus on treating iron deficiency (ID). Feraccru®/Accrufer® has been approved by the regulators in both Europe and the US. For various reasons, STX has been unable to secure a commercial partner for Accrufer in the US. Consequently, the board is now considering an STX-led launch option, thereby retaining all the US profits. Financial modelling shows the logic of this option, but it would necessitate financing the working capital requirements covering the next two years in the region of £25m-£30m.
Companies: Shield Therapeutics Plc
IXICO has reported its financial results to the end of September 2020. Over the period, revenues grew 26% to £9.5m while EBITDA of £1.3m was more than double FY19A's £0.5m (October Trading update: revs £9.5m, EBITDA ‘at least' £1.1m). The order book closed at £21.7m, a record high, and we note subsequent confirmed orders post the year end, indicating strong business development. IXICO has invested through the year and maintains a strong balance sheet to continue investing through FY21E. We have made minor adjustments to our FY21E expectations and maintain our Buy recommendation.
Companies: IXICO Plc
Whilst the H1 outturn reflected the difficulties caused by the pandemic, investors should not lose sight of the substantial strategic progress made in recent months. This has not only built resilience and agility within the business, allowing it to react to the extraordinary market conditions, but strengthened the medium term growth prospects. We make no change to our headline forecasts at this stage, but mindful of the substantial H2 weighting, provide an illustration of the mix changes and a bridge to our FY21 estimates in this note.
Companies: Yourgene Health Plc
