Newron Pharmaceuticals

SW: NWRN

CHF103.9m market cap

CHF5.82 last close

Newron is a CNS-focused biotech. Xadago (partnered with Zambon, US WorldMeds, Meiji Seika, Sequirus) for PD has been launched in Europe and the US. Other pipeline assets include Sarizotan (Phase III for RS) and Evenamide (Phase II for schizophrenia).

Investment summary

Newron Pharmaceuticals’ recently reported interim results highlight that despite additional worldwide launches of Xadago, sales growth in the US and Europe remain below our expectations. For Evenamide, the company is addressing FDA concerns on the pre-clinical data and plans are underway for short-term explanatory studies before starting the pivotal Phase III trials. Top-line data from the pivotal trial Sarizotan Treatment of Apnoeas in Rett Syndrome (STARS), are expected in Q419. The reported net loss increased 85% to €14.0m in H119, driven by higher than expected net R&D expenses. We value Newron at CHF466m or CHF26.1/share.

Y/E Dec
Revenue (€m)
EBITDA (€m)
PBT (€m)
EPS (c)
P/E (x)
P/CF (x)
2017A 13.4 (4.3) (5.3) (32.32) N/A N/A
2018A 4.0 (14.9) (15.0) (84.20) N/A N/A
2019E 5.5 (23.5) (23.4) (131.11) N/A N/A
2020E 11.9 (15.2) (15.1) (84.81) N/A N/A
Industry outlook

The market for treating CNS disorders is substantial and growing. Xadago is approved and marketed in key territories as an add-on to levodopa therapy in Parkinson’s disease.

Last updated on 12/11/2019
Sector
Healthcare
Share price graph
Balance sheet
Forecast net cash (€m) 17.8
Forecast gearing ratio (%) N/A
Price performance
%
1m
3m
12m
Actual (2.2) (3.0) (28.4)
Relative* (5.0) (8.2) (37.6)
52-week high/low CHF9.4/CHF5.4
*% relative to local index
Key management
Stefan Weber CEO
Marco Caremi Executive VP of Business Development