DJ Vicore Pharma Holding AB (VICO-SE): Scleroderma the second indication for VP01 (C21)
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goetzpartners securities Limited
Vicore Pharma Holding AB (VICO-SE): Scleroderma the second indication for VP01
(C21)
25-Apr-2019 / 10:41 GMT/BST
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*Published to the market and investors on 25th April 2019 @ 8.01am (BST).*
*Vicore Pharma Holding AB (VICO-SE): Scleroderma the second indication for
VP01 (C21)*
*Recommendation: OUTPERFORM*
*Target Price: SEK42.00 *
*Current Price: SEK16.65 (CoB on 24th April 2019)*
*KEY TAKEAWAY*
Vicore announced that it has selected diffuse systemic sclerosis ("dSSc") as
the second rare disease indication for lead asset VP01 (C21), which is already
in development for idiopathic pulmonary fibrosis ("IPF"). Phase IIa
proof-of-concept trials for both indications are expected to start in
H2/2019E, with data possible in mid-2021E. Based on the estimated prevalence
and limited therapeutic options, our preliminary analysis suggests that dSSc
could represent a sales opportunity for VP01 close to that in IPF, for which
we forecast c.$1.5bn in peak sales in 2034E. Our valuation and hence SEK42 /
share target price for Vicore only reflect risk-adjusted net present values
("rNPVs") for VP01 in IPF and for VP02 in IPF cough; hence, there is upside to
our forecasts for development in additional indications. We reiterate our
OUTPERFORM recommendation.
*Diffuse systemic sclerosis is a rare disease with high unmet need*
Systemic sclerosis ("SSc") - or scleroderma - is a chronic autoimmune disease
mediated through fibrotic proliferation of connective tissue. It is
characterised by skin thickening, and sometimes spreads to inner organs such
heart, lungs and kidneys, as well as the musculoskeletal and digestive
systems. It is 3 - 4 times more common in women than men. The prevalence is
estimated at 150 - 400 individuals per million. There is no curative treatment
and disease management therefore focuses on symptom alleviation using e.g.
phototherapy, physiotherapy and glucocorticoids. Vicore intends to target the
c.20% of patients presenting with the severe diffuse form and that are often
treated with potent immunomodulatory drugs or autologous stem cell
transplantation. Their disease can be life-threatening, depending on
pulmonary, cardiac and renal involvement.
*Rationale for development is upregulation of AT2R, the biological target of
VP01*
Angiotensin II plays an important role in dSSc and the angiotensin II type 2
receptor ("AT2R") is known to be upregulated in dSSc patients. VP01 is a small
molecule agonist of the AT2R that increases signalling through the receptor,
thus augmenting its antifibrotic, anti-inflammatory and tissue-protective
effects, as demonstrated in many relevant preclinical disease models.
Market opportunity for VP01 in dSSc may be as large as in IPF
While the overall SSc patient population is similar to IPF, Vicore will focus
on the approx. 20% of patients with severe diffuse disease. That said, we
expect the market environment to be less competitive. There are no approved
therapies - in contrast to two in IPF, Ofev (nintedanib) and Esbriet
(pirfenidone) plus a few in late-stage clinical development - and to our
knowledge only one compound is currently undergoing regulatory review
following the submission of nintedanib to the FDA in March 2019 for SSc
associated interstitial lung disease. Hence, if successful, VP01 could capture
a higher market share in SSc than the 15% we currently assume for IPF, a
market that was worth c.$2.2bn in 2018.
*New indication represents upside to valuation*
Our fair value for Vicore only includes rNPVs for VP01 in IPF (c.70%) and VP02
in IPF cough (c.22%) in addition to net cash at YE2019E. Assuming a similar
timeline and comparable R&D costs for VP01 in dSSc as in IPF should lead to a
significant increase to our valuation. We intend to update our forecasts in
due course.
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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