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Marinomed Biotech AG (MARI-AT): Budesolv succeeds in pivotal Phase III trial
25-Apr-2019 / 10:35 GMT/BST
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*Marinomed Biotech AG (MARI-AT): Budesolv succeeds in pivotal Phase III trial*
*Recommendation: OUTPERFORM*
*Target Price: EUR95.00 *
*Current Price: EUR79.00 (CoB on 24th April 2019)*
*KEY TAKEAWAY*
Marinomed reported that Budesolv met the primary endpoint of the pivotal Phase
III trial in allergic rhinitis ("AR"), demonstrating non-inferiority to
marketed product Rhinocort Aqua. Importantly, this was achieved at about
one-sixth of the budesonide dose and with a preservative-free formulation. The
positive outcome allows Marinomed to proceed with the regulatory process, and
we therefore continue to expect approval in Europe in Q4/2020E or Q1/2021E
depending on the availability of production slots for validation batches. Our
fair value remains unchanged at EUR95 per share (c.20% upside) pending detail
trial data later in Q2/2019E, which should also clarify whether Budesolv met
the secondary endpoint designed to show a faster onset of action. We see this
as a key differentiating factor for Budesolv to meet our c.EUR760m peak sales
forecast (<4% market share). Marinomed intends to sell Budesolv as an OTC
product, offering the opportunity to leverage the existing global network of
partners used for its marketed product portfolio. Maintain OUTPERFORM.
*Budesolv met the primary endpoint of non-inferiority vs. J&J's Rhinocort
Aqua*
Budesolv contains the glucocorticoid budesonide commonly used for allergy and
autoimmune diseases, reformulated based on the proprietary Marinosolv
platform. This increases the solubility, thus allowing for the administration
of a much lower dose. The European Phase III trial (which enrolled 84
patients, of whom 75 were eligible for the primary endpoint analysis) tested
Budesolv as a nasal spray for AR, an inflammation of the nasal mucous
membranes that affects up to 30% of people. The primary endpoint was
non-inferiority vs. Rhinocort Aqua (budesonide suspension), Johnson &
Johnson's ("J&J") successful OTC product with 2017 retail sales of $250m in
the >$12bn AR market. Top-line data suggests that this endpoint was met.
*Secondary endpoint designed to show faster onset of action still outstanding*
Marinomed had planned to differentiate Budesolv through the inclusion of a
secondary endpoint focused on showing faster onset of relief of minutes rather
than days. We understand that the company does not yet have sufficient data to
provide feedback on this endpoint and we therefore look forward to further
details once the full data is published at the end of Q2/2019E.
*Valuation unchanged pending detailed data later in Q2/2019E*
As highlighted in our recent initiation of coverage report, a positive outcome
for the Budesolv Phase III trial would lead us to increase the probability of
success in AR to 85% (from 75%). Since the outcome also provides validation
for the Marinosolv platform overall, we also intend to increase the
probability of success for the second Marinosolv asset Tacrosolv (based on
tacrolimus), specifically, to 20% (from 15%) in allergic conjunctivitis and to
15% (from 10%) in dry eye disease. In aggregate, these changes would lift our
fair value to EUR107 per share.
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 +44 (0) 203 859 7725 | brigitte.delima@goetzpartners.com /
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(END) Dow Jones Newswires
April 25, 2019 05:35 ET (09:35 GMT)
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