IR-Center Handelsblatt
Unternehmenssuche:

goetzpartners securities Limited

News Detail

EQS-News News vom 04.05.2018

Basilea Pharmaceutica AG (BSLN-CH): Derazantinib deal adds third oncology asset

goetzpartners securities Limited

04-May-2018 / 10:44 GMT/BST


Free to access research and investor meetings in a post-MiFID2 world

Basilea Pharmaceutica AG (BSLN-CH): Derazantinib deal adds third oncology asset
Recommendation: OUTPERFORM
Target Price: CHF108 (increased from CHF107)
Current Price: CHF70.05 (COB on 3rd May 2018)

KEY TAKEAWAY

Basilea has signed an in-licensing agreement with ArQule for late-stage oncology asset derazantinib (ARQ 087), a small molecule that targets the fibroblast growth factor receptor ("FGFR") family of kinases. Derazantinib is in Phase II development for second-line intrahepatic cholangiocarcinoma ("iCCA"), a rare cancer with limited treatment options and a poor prognosis. Under the terms of the deal, Basilea will pay $10m upfront and up to $326m in milestones. We estimate that only c.$5m are related to iCCA and the remainder to large, non-orphan solid tumour indications being assessed. We forecast launch in Q4/2023E and peak sales of c.$70m in iCCA, with Basilea paying ArQule an estimated 8% royalty rate. There could be upside to our forecasts if derazantinib receives accelerated / conditional approval in late 2021E based on data from the ongoing Phase II trial. We nudge our target price ("TP") to CHF108 per share and maintain our OUTPERFORM recommendation.

Initial focus on iCCA patients with FGFR2 fusions

Basilea will continue to pursue iCCA, where ArQule has already generated encouraging Phase I/II data and a Phase II trial is currently ongoing. Derazantinib is being developed as a second-line agent for the c.20% of iCCA patients with an FGFR2 fusion, the most common type of genetic alteration in the FGFR2, yielding an addressable patient population of c.2,500 patients in the US and Europe. Surgical resection or liver transplantation currently represent the only curative treatments. In patients with advanced disease, standard of care is combination chemotherapy consisting of gemcitabine / cisplatin. Patients who relapse after first-line chemotherapy have limited treatment options and a poor prognosis.

Encouraging efficacy signals in Phase I/II; Phase II data expected in H2/2020E

In an open-label Phase I/IIa study in 119 patients with advanced solid tumours with FGFR genetic alterations, derazantinib monotherapy led to an overall response rate of 21% in the 29 iCCA patients with FGFR2 fusions, including six partial responses. A c.100-patient Phase II trial started in Q4/2017 and results from an interim analysis in >40 patients are expected in H2/2019E, with full data anticipated in late 2020E.

Nudging TP to CHF108 per share

Adding our risk-adjusted net present value ("rNPV) for derazantinib in iCCA to our valuation increases our TP by c.CHF1 per share, based on assuming a probability of success of 25%. Our updated financial models reflect the $10m upfront payment to ArQule in 2018E (booked in R&D) and slightly higher R&D costs overall from 2018E onwards owing to the additional expenses associated with the development of derazantinib in iCCA. This has increased our 2018E operating loss forecast to CHF29.8m and pushed back expected profitability by one year to 2021E.

Kind regards,


Brigitte de Lima, PhD, CFA | Analyst

goetzpartners Healthcare Research Team | Research Team

goetzpartners securities Limited

The Stanley Building, 7 Pancras Square, London, N1C 4AG, England, UK.

T +44 (0) 203 859 7725 | [email protected] / [email protected]

www.goetzpartnerssecurities.com

Registered in England No. 04684144.

Managing Directors: Dr Stephan Goetz, Martin Brunninger and Ulrich Kinzel.

GPSL publishes and distributes "Investment" Research and "Corporate Sponsored" Research. Our Corporate Sponsored Research and investor meetings (e.g. NDRs, 1 to 1 meetings) are free to access and attend and is not classified as an inducement in a post-MiFID2 world. GPSL does not offer any execution or market making services. This is a marketing communication as defined by the Financial Conduct Authority ("FCA"). The information herein is considered to be an acceptable minor non-monetary benefit as defined under FCA COBS 2.3A19(5).

In accordance with the General Data Protection Regulation ("GDPR") - if you would like to be removed / unsubscribed from our CRM (also please note that you are free to contact GPSL at any time in the future to have your e-mail subscription amended), please e-mail:
[email protected]

About GPSL: goetzpartners securities Limited is a member of the goetzpartners group and a leading true pan European investment bank and research firm. We bring together a wide range of expertise, insights and innovations to advance the interests of our clients around the world. The fast changing environment brings challenges for businesses and investors. Research innovation, digital transformation and disruptive business ideas reshuffle the corporate world in a yet unexperienced pace. Our sector knowledge and our global footprint bring together deep understanding of the industry, corporate intelligence and a wide network of top decision makers.

This research report is intended for use only by persons who qualify as professional investors or eligible counterparties (institutional investors) in the applicable jurisdiction, and not by any private individuals or other persons who qualify as retail clients.

This e-mail (including any attachments) from goetzpartners securities Limited ("GPSL") is confidential and may contain information which is proprietary, privileged or otherwise legally protected against unauthorised use or disclosure. If you receive this e-mail in error or are not the intended recipient of this e-mail, please delete and destroy all copies in your possession, notify the sender that you have received this e-mail, and note that any review or dissemination of, or the taking of any action in reliance on this e-mail is expressly prohibited. GPSL shall not be liable for the improper or incomplete transmission of the information contained in this e-mail nor for any delay in its receipt or damage to your system. GPSL does not guarantee that the integrity of this e-mail has been maintained nor that this e-mail is free of viruses, interceptions or interference and makes no warranties in relation to these matters. This is not an offer or a solicitation to buy or sell securities or investment products, or an official confirmation. GPSL record electronic and phone communications in accordance with FCA and MiFID2 regulations, they will be monitored for regulatory and training purposes. GPSL is authorised and regulated by the Financial Conduct Authority of the United Kingdom (Firm Reference Number: 225563).

Click on the following link for the GPSL MiFID2 Investor Guidance Notice

GPSL Equity Research publications are available on the following aggregators and via news distribution circuits (For Institutional Use Only): AlphaSense, Bloomberg (GOET), Capital IQ, EQS, FACTSET, RNS Reach and Thomson Reuters.

If you cannot click on the above hyperlink please copy the below link and paste it into your browser for the full pdf version of the equity research report:

https://gp.bluematrix.com/sellside/EmailDocViewer?encrypt=b97b8806-b34d-4a61-92d8-3afac03b0b55&mime=pdf&co=gp&[email protected]&source=libraryView



Dissemination of a CORPORATE NEWS, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.


End of Announcement - EQS News Service

show this