Basilea Pharmaceutica AG (BSLN-CH): Cresemba on track, pipeline expanding

Dow Jones received a payment from EQS/DGAP to publish this press release.

goetzpartners securities Limited 
Basilea Pharmaceutica AG (BSLN-CH): Cresemba on track, pipeline expanding 
 
28-Feb-2019 / 12:04 GMT/BST 
 
*Free to access research and investor meetings in a post-MiFID2 world.* 
 
*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.* 
 
*Published to the market and investors on 28th February 2019 @ 7.58am (GMT).* 
 
*Basilea Pharmaceutica AG (BSLN-CH): Cresemba on track, pipeline expanding* 
*Recommendation: OUTPERFORM* 
*Target Price: CHF 107 (reduced from CHF 112) * 
*Current Price: CHF 49.64 (CoB on 27th February 2019) * 
 
*KEY TAKEAWAY* 
 
Basilea reported FY2018 revenue growth of 31% to CHF133m, driven by antifungal 
Cresemba. We expect limited revenue growth in 2019E, but note that there will 
be a shift towards cash-generating revenues, since deferred revenue of 
CHF23.9m related to Toctino will be replaced by contributions from Cresemba 
and antibiotic Zevtera (we forecast +30% YoY), translating to a reduction in 
net cash burn. With the commercialisation of Cresemba and Zevtera handed over 
to partners, Basilea is fully focused on its pipeline, particularly oncology 
asset derazantinib, which will enter additional clinical trials this year. We 
trim our target price ("TP") to CHF107 (from CHF112), reflecting a lower cash 
balance by YE2019E and delay of a potential US licensing deal for ceftobiprole 
by one year, and retain our OUTPERFORM recommendation. We believe that the 
share price neither reflects continued strong growth from marketed products 
nor attributes value to clinical-stage pipeline assets. 
 
*Global Cresemba rollout delivering solid revenue growth* 
 
We estimate that global in-market sales of Cresemba reached c.$160m in 2018, 
up from $90m -$95m in 2017, with the US accounting for c.70%, Europe for c.25% 
and RoW for the remainder. We are confident that Cresemba is on track to reach 
our peak sales forecast of c.$645m in 2026E, of which we expect ex-US to 
account for c.65%. Cresemba is currently marketed in 20 countries globally by 
partners Astellas (US), Pfizer (Europe) and Grupo Biotoscana (Latin America), 
a figure Basilea anticipates will double to about 40 by YE2019E and triple to 
60 by 2021E, based on these and other partnerships that have already been 
signed for both Cresemba and Zevtera. 
 
*Oncology-focused pipeline expanding* 
 
With two ceftobiprole Phase III trials underway and $95m in funding from BARDA 
covering c.70% of costs secured, management has been focusing on its oncology 
assets, particularly derazantinib. The fibroblast growth factor receptor 
("FGFR") inhibitor is in a Phase II registrational trial in FGFR2-gene fusion 
positive intrahepatic cholangiocarcinoma ("iCCA"). Positive interim data 
reported in early January 2019 confirmed derazantinib's activity as single 
agent, prompting Basilea to expand into additional trials, including (1) 
combination with Roche's PD-L1 checkpoint inhibitor Tecentriq (atezolizumab) 
in urothelial cancer and (2) as single agent in other FGFR gene aberrations, 
conducted as expansion of the ongoing iCCA trial. 
 
*Ceftobiprole Phase III data from skin trial the next datapoint* 
 
The next catalyst is Phase III data for ceftobiprole in acute bacterial skin 
and skin structure infections ("ABSSSI") in H2/2019E, which would de-risk the 
development programme. That said, we do not anticipate a licensing deal for 
the US market until the second Phase III trial in S. aureus bacteraemia 
("SAB") reads out in H2/2021E (both trials will be required for US filing) and 
now model a licensing deal in late 2021E (vs. 2020E previously). 
 
Kind regards, 
 
Brigitte de Lima | Analyst 
 
goetzpartners Healthcare Research Team | Research Team 
 
goetzpartners securities Limited 
 
The Stanley Building, 7 Pancras Square, London, N1C 4AG, England, UK. 
 
T [phone] | [e-mail] / 
[e-mail] 
 
www.goetzpartnerssecurities.com [1] 
 
goetzpartners securities LinkedIn page [2] 
 
Registered in England No. 04684144. 
 
Managing Directors: Dr Stephan Goetz, Martin Brunninger and Ulrich Kinzel. 
 
*goetzpartners securities Limited - Team Members* 
 
Equity Research Analysts - Martin Brunninger, Brigitte de Lima, Chris Redhead, 
Martin Piehlmeier and Kieron Banerjee. 
 
Sales / Marketing - Erland Sternby. 
 
Corporate Finance - Ulrich Kinzel, Wolf Dornbusch and Youchen Xin. 
 
Corporate Access and IR - Tanya Tracey and Bettina Ellinghorst. 
 
Compliance - Paul W. Dunne. 
 
Click here [3] to see our privacy policy. 
 
GPSL has a formal client relationship with Basilea Pharmaceutica AG. 
 
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, this is because the issuer is paying GPSL. 
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 [4]") - 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: 
[e-mail] 
 
About GPSL [1]: goetzpartners securities Limited is a member of the 
goetzpartners group, and a leading pan European investment bank and research 
company. 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 at a relentless pace. Our sector knowledge and our global 
footprint bring together corporate intelligence and a deep understanding of 
the industry with a wide network of top decision makers. These collective 
insights help our clients to stay at the leading edge of change. 
 
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 communication (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 communication in error or are not the 
intended recipient of this communication, please delete and destroy all copies 
in your possession, notify the sender that you have received this 
communication, and note that any review or dissemination of, or the taking of 
any action in reliance on this communication is expressly prohibited. GPSL 
shall not be liable for the improper or incomplete transmission of the 
information contained in this communication nor for any delay in its receipt 
or damage to your system. GPSL does not guarantee that the integrity of this 
communication has been maintained nor that this communication 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 
[5] 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 [6] 
 
GPSL Equity Research publications are available on the following aggregators 
and via news distribution circuits (For Institutional Use Only): AlphaMetry 
[7], AlphaSense, Bloomberg (GOET), Capital IQ, EQS, FACTSET, ResearchFN [8], 
Research Tree [9], RNS Reach, Sentieo [10] and Thomson Reuters. 
 
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=1bd1f691-e5da-47fc-b 
6bd-aad29b62d460&mime=pdf&co=gp&id=[e-mail]&source=library 
View [11] 
 
*Free to access research and investor meetings in a post-MiFID2 world.* 
 
*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.* 
 
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 
 
782349 28-Feb-2019 
 
 
1: https://link.cockpit.eqs.com/cgi-bin/fncls.ssp?fn=redirect&url=750ca54579c5d5447638f7f35718f4d1&application_id=782349&site_id=vwd&application_name=news 
2: https://link.cockpit.eqs.com/cgi-bin/fncls.ssp?fn=redirect&url=4e235136b3fff70f6e9b300faf1356df&application_id=782349&site_id=vwd&application_name=news 
3: https://link.cockpit.eqs.com/cgi-bin/fncls.ssp?fn=redirect&url=e4cf3d45df1d07e4e36e54790266d6f1&application_id=782349&site_id=vwd&application_name=news 
4: https://link.cockpit.eqs.com/cgi-bin/fncls.ssp?fn=redirect&url=105c239b1a4ab584252dd4cb0ab60fcc&application_id=782349&site_id=vwd&application_name=news 

(MORE TO FOLLOW) Dow Jones Newswires

February 28, 2019 07:04 ET (12:04 GMT)