London, UK, 29 June 2017

Edison issues initiation on NeuroVive Pharmaceutical (NVP)

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.

We value NeuroVive at SEK1.5bn or SEK30/share based on a risk-adjusted NPV model using a 12.5% discount rate, including SEK67.3m net cash at end-Q117. We include five of the company's seven assets. We value the two clinical stage assets, NeuroSTAT and KL1333, at SEK299m and SEK441m respectively, which comprises 50% of the total rNPV. NeuroVive's initiation of the proof-of-concept Phase IIb trial with NeuroSTAT in TBI and initiation of the Phase I study with KL1333 by NeuroVive (Yungjin is already recruiting to its own Phase I) are the near-term R&D events within the next 12-18 months. Meanwhile, potential out-licensing of NV556 could be a substantial trigger for the share price.

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