Destiny Pharma has announced details of positive feedback from the European Medicines Agency (EMA) on the proposed Phase 3 programme for one of its two Phase 3-ready products, XF-73 for the prevention of post-surgical staphylococcal infections: • the successful completion of the proposed Phase 3 clinical programme is expected to lead to the registration of XF-73 nasal gel in Europe. While the number of patients in the study and the number of separate trials in the programme have not been disclosed, (probably for competitive reasons), any agreement (or scientific advice) with the European regulator should be viewed as a positive step. • a similar microbiological endpoint of decolonisation, which resulted in the positive Phase 2b study reported last year, as well as the patient population – those at high risk of a post-surgical infection with S.aureus – have both been kept for Phase 3. • the EMA prefers active comparator studies and, in Destiny’s case, Bactroban Nasal (mupirocin nasal formulation) will be the active control. This is likely to please infectious disease physicians because of mupirocin’s association with antibiotic resistance (AMR). The lower costs to achieve an approved product in Europe can now be quantified and make any transaction more attractive to potential partners. We retain our fair value of Destiny Pharma at £187.9m or 314p per share.