Hepion Pharmaceuticals — Increased operating expenses

Hepion Pharmaceuticals (US: HEPA)

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1.55

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Research: Healthcare

Hepion Pharmaceuticals — Increased operating expenses

Hepion reported a loss from operations of $4.8m in Q220, compared to $4.2m in Q120, along with R&D costs of $3.0m, compared to $2.6m in Q120. We believe strained pharmaceutical supply chains as a result of the pandemic have contributed to the increase in drug supply costs that pushed R&D expenses higher for a second consecutive quarter. As such, we have increased our FY20 R&D forecast from $9m to $10.3m.

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Written by

Healthcare

Hepion Pharmaceuticals

Increased operating expenses

Earnings update

Pharma & biotech

21 August 2020

Price

US$3.81

Market cap

US$34m

Net cash ($m) at 30 June 2020

17.4

Shares in issue

9.03m

Free float

99.47%

Code

HEPA

Primary exchange

NASDAQ

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

(11.6)

107.1

51.8

Rel (local)

(15.1)

81.8

30

52-week high/low

US$6.99

US$1.15

Business description

Hepion Pharmaceuticals is a clinical stage biopharmaceutical company focused on developing therapeutics for chronic liver disease. The company’s lead asset is CRV431, a cyclophilin inhibitor being developed for the treatment of non-alcoholic steatohepatitis.

Next events

Completion of Phase Ib dosing study

Q320

Data from Phase Ib dosing study

Q320

Data from Phase IIa study

Q420

Initiate Phase IIb study

Q221

Analysts

Nathaniel Calloway

+1 646 653 7036

Wiktoria O’Hare

+1 646 653 7028

Hepion Pharmaceuticals is a research client of Edison Investment Research Limited

Hepion reported a loss from operations of $4.8m in Q220, compared to $4.2m in Q120, along with R&D costs of $3.0m, compared to $2.6m in Q120. We believe strained pharmaceutical supply chains as a result of the pandemic have contributed to the increase in drug supply costs that pushed R&D expenses higher for a second consecutive quarter. As such, we have increased our FY20 R&D forecast from $9m to $10.3m.

Year end

Revenue ($m)

PBT*
($m)

EPS*
($)

DPS
($)

P/E
(x)

Yield
(%)

12/18

0.0

(9.8)

(55.87)

0.0

N/A

N/A

12/19

0.0

(7.9)

(4.32)

0.0

N/A

N/A

12/20e

0.0

(16.2)

(1.91)

0.0

N/A

N/A

12/21e

0.0

(12.4)

(1.44)

0.0

N/A

N/A

Note: *PBT and EPS are normalised, excluding amortization of acquired intangibles, exceptional items and share-based payments.

Clinical program moving along

Hepion progressed to the next phase of its clinical program on 5 August 2020 with the initiation of its Phase IIa pilot study AMBITION. The primary endpoint is to assess the safety and tolerability of CRV431 at a 75mg dose, while the company will also gather data on a range of biomarkers to assess if the drug has meaningful clinical activity before moving into larger clinical trials. Study data are expected in Q420. Meanwhile, on 29 June 2020, Hepion announced it had commenced the final dose level of 375mg in the Phase Ib multiple ascending dose study. The study is expected to conclude in Q320, with data in the same quarter.

Increased R&D spending

Hepion reported a loss from operations of $4.8m in Q220, compared to $4.2m in Q120, while R&D expenses were $3.0m, compared to $2.6m in Q120. As in Q120, the company cited increased drug supply costs as contributing to this quarter’s R&D costs, which we believe is a result of strained pharmaceutical supply chains due to the ongoing pandemic. We have increased our 2020 R&D expense estimate from $9m to $10.3m, which includes the Phase Ib and Phase IIa studies. We also increased our 2020 G&A expense forecast from $6.1m to $6.9m.

Valuation: Lowered to $52.5m or $5.82/basic share

Cash and equivalents were $17.4m at quarter end, compared to $16.0m in Q120. The company had about $4.6m in positive financing cash flows in Q220, much of which was related to the at-the-market equity facility (with $11.2m raised year-to-date). We have lowered our valuation slightly to $52.5m or $5.82/basic share ($5.80 diluted), from $53.5m or $5.93/basic share, previously. This movement is driven by lower net cash and increases in our R&D cost assumptions, offset by rolling forward our NPVs. We continue to the expect the company will need $115m in additional capital to complete development of CRV431, which is recorded as illustrative debt amounting to $15m in 2020, $50m in 2023 and $50m in 2025.

Financials

Hepion reported a loss from operations of $4.8m in Q220, compared to $4.2m in Q120. The company had R&D expenses of $3.0m, compared to $2.6m in Q120, with the increase mainly due to drug supply costs and clinical study related expenses (relating to the Phase Ib study and for the initiation of the Phase IIa trial). The company stated that drug supply costs contributed to increased R&D expenses in both Q120 and Q220, but did not provide additional details as to why drug costs had increased. We believe drug supply costs may have increased as a result of the pandemic since pharmaceutical supply chains have been strained and we expect drug supply costs to remain at the current level until year end. General and administrative costs for the quarter were $1.8m, compared to $1.5m in Q120, while cash and cash equivalents were $17.4m at quarter end, compared to $16.0m in Q120; the company had about $4.6m in positive financing cash flows in Q220, much of which was related to the at-the-market equity facility described below.

We expect R&D costs to remain steady in the coming quarters as the company continues to progress with the ongoing Phase IIa clinical trial, with no additional planned clinical trial activity for the rest of the year. We have slightly increased our forecasted R&D expenses from $9m to $10.3m in 2020, which includes the Phase Ib and Phase IIa studies. We have also increased our forecasted general and administrative costs from $6.1m to $6.9m in 2020. We expect the operating cash flow loss to be $11.6m in 2020, which is a minor change from our prior forecast of a $11.7m outflow.

We continue to expect the company will need $115m in additional capital to complete development of CRV431, which is recorded as illustrative debt amounting to $15m in 2020, $50m in 2023 and $50m in 2025. The $15m in 2020 is in addition to the $11.2m in net proceeds the company has already raised year-to-date via an ongoing at-the-market equity facility. Under the Sales Agreement, a total of 5.3m shares were sold as of 30 June 2020.

Valuation

We have lowered our valuation to $52.5m or $5.82/basic share ($5.80 diluted), from $53.5m or $5.93/basic share, previously. This movement is driven by lower net cash ($17.4m at 30 June 2020, compared to our prior $20.6m pro-forma Q120 net cash measure inclusive of post-Q1 ATM proceeds) and increasing our R&D cost assumptions, offset by rolling forward our NPVs.

Exhibit 1: Valuation

Program

Market

Prob. of success

Launch Year

Peak Revenue ($m)

Valuation ($m)

CRV431

US

10%

2026

370.8

24.42

Europe

10%

2027

373.0

20.00

R&D & milestones

100%

(9.31)

Total

35.12

Net cash and equivalents (Q220)

17.39

Total firm value ($m)

52.50

Total basic shares (m)

9.03

Value per basic share ($)

5.82

Convertible preferred stock (m)

0.02

Dilutive options and warrants (m)

0.0

Total diluted shares (m)

9.1

Value per diluted share ($)

5.80

Source: Edison Investment Research

Exhibit 2: Financial summary

$'000

2018

2019

2020e

2021e

31-December

IFRS

IFRS

IFRS

IFRS

INCOME STATEMENT

Revenue

 

 

0.0

0.0

0.0

0.0

Cost of Sales

0.0

0.0

0.0

0.0

Gross Profit

0.0

0.0

0.0

0.0

R&D

(7,593.7)

(3,184.1)

(10,295.6)

(6,477.3)

SG&A

(7,000.4)

(4,586.0)

(6,886.5)

(7,093.1)

EBITDA

 

 

(14,340.9)

(7,677.2)

(15,961.9)

(12,378.3)

Normalised operating profit

 

 

(14,359.6)

(7,703.9)

(15,990.0)

(12,378.3)

Amortisation of acquired intangibles

0.0

0.0

0.0

0.0

Exceptionals

0.0

0.0

0.0

0.0

Share-based payments

(234.5)

(66.2)

(1,192.1)

(1,192.1)

Reported operating profit

(14,594.2)

(7,770.1)

(17,182.1)

(13,570.3)

Net Interest and financial income

4,608.9

(175.9)

(217.6)

0.0

Joint ventures & associates (post tax)

0.0

0.0

0.0

0.0

Exceptionals

0.0

0.0

0.0

0.0

Profit Before Tax (norm)

 

 

(9,750.8)

(7,879.8)

(16,207.5)

(12,378.3)

Profit Before Tax (reported)

 

 

(9,985.3)

(7,946.0)

(17,399.6)

(13,570.3)

Reported tax

536.0

1,227.3

2,687.5

2,096.0

Profit After Tax (norm)

(10,274.2)

(8,832.6)

(18,113.0)

(14,283.7)

Profit After Tax (reported)

(9,449.3)

(6,718.7)

(14,712.1)

(11,474.3)

Minority interests

0.0

0.0

0.0

0.0

Deemed Dividend

(8,451.9)

(5,442.9)

0.0

0.0

Discontinued operations

0.0

0.0

0.0

0.0

Net income (normalised)

(10,274.2)

(8,832.6)

(18,113.0)

(14,283.7)

Net income (reported)

(17,901.1)

(12,161.6)

(14,712.1)

(11,474.3)

Basic average number of shares outstanding (m)

184

2,043

9,476

9,950

EPS - basic normalised ($)

 

 

(55.87)

(4.32)

(1.91)

(1.44)

EPS - diluted normalised ($)

 

 

(55.87)

(4.32)

(1.91)

(1.44)

EPS - basic reported ($)

 

 

(97.35)

(5.95)

(1.55)

(1.15)

Dividend ($)

0.00

0.00

0.00

0.00

BALANCE SHEET

Fixed Assets

 

 

5,221.2

6,043.9

5,923.2

5,759.2

Intangible Assets

1,870.9

1,870.9

1,870.9

1,870.9

Tangible Assets

32.4

57.2

61.1

61.1

Investments & other

3,317.8

4,115.9

3,991.1

3,827.1

Current Assets

 

 

2,968.0

14,388.7

29,349.3

17,630.6

Stocks

0.0

0.0

0.0

0.0

Debtors

0.0

0.0

0.0

0.0

Cash & cash equivalents

2,832.4

13,923.0

28,742.2

17,023.5

Other

135.6

465.7

607.1

607.1

Current Liabilities

 

 

(2,849.9)

(1,251.9)

(3,548.1)

(1,947.7)

Creditors

(748.4)

(491.6)

(1,917.4)

(1,673.1)

Tax and social security

0.0

0.0

0.0

0.0

Short term borrowings

(1,440.0)

0.0

0.0

0.0

Other

(661.4)

(760.3)

(1,630.8)

(274.6)

Long Term Liabilities

 

 

(3,364.3)

(2,995.1)

(18,188.4)

(18,188.4)

Long term borrowings

0.0

0.0

(15,176.6)

(15,176.6)

Other long term liabilities

(3,364.3)

(2,995.1)

(3,011.8)

(3,011.8)

Net Assets

 

 

1,975.1

16,185.6

13,535.9

3,253.7

Minority interests

0.0

0.0

0.0

0.0

Shareholders' equity

 

 

1,975.1

16,185.6

13,535.9

3,253.7

CASH FLOW

Op Cash Flow before WC and tax

(14,340.9)

(7,677.2)

(15,961.9)

(12,378.3)

Working capital

(970.5)

(754.6)

1,797.0

(1,600.5)

Exceptional & other

(870.7)

(360.6)

(108.8)

164.0

Tax

536.0

1,227.3

2,687.5

2,096.0

Net operating cash flow

 

 

(15,646.0)

(7,565.1)

(11,586.1)

(11,718.7)

Capex

0.0

(51.5)

(34.3)

0.0

Acquisitions/disposals

0.9

0.0

2.2

0.0

Net interest

0.0

0.0

0.0

0.0

Equity financing

12,192.5

19,826.5

11,260.8

0.0

Dividends

0.0

0.0

0.0

0.0

Other

(1,000.0)

(1,119.4)

0.0

0.0

Net Cash Flow

(4,452.6)

11,090.5

(357.4)

(11,718.7)

Opening net debt/(cash)

 

 

(5,954.0)

(1,392.4)

(13,922.9)

(13,565.6)

FX

0.0

0.0

0.0

0.0

Other non-cash movements

(109.0)

1,440.0

0.0

0.0

Closing net debt/(cash)

 

 

(1,392.4)

(13,922.9)

(13,565.6)

(1,846.9)

Source: Hepion reports, Edison Investment Research

General disclaimer and copyright

This report has been commissioned by Hepion Pharmaceuticals and prepared and issued by Edison, in consideration of a fee payable by Hepion Pharmaceuticals . Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2020 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

General disclaimer and copyright

This report has been commissioned by Hepion Pharmaceuticals and prepared and issued by Edison, in consideration of a fee payable by Hepion Pharmaceuticals . Edison Investment Research standard fees are £49,500 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2020 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

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Research: Healthcare

BioPorto Diagnostics — Record setting NGAL sales

BioPorto reported a major increase in Q220 sales for the NGAL research use only (RUO) test, to DKK5.0m, up from DKK3.8m in Q219. This is the single highest quarter for NGAL RUO sales, and uptake in the US has been especially strong, up 95% y-o-y. Sales for the company’s other products were down (DKK1.7m, from DKK4.0m in Q219) reflecting the company’s shift in focus to NGAL. Although RUO NGAL sales remain relatively small, they represent the beachhead for the eventual launch of the FDA-cleared NGAL Test, which we expect to have first commercial sales in 2021.

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