Basilea has bolstered its drug pipeline with the in-licensing of fosmanogepix, a broad-spectrum antifungal candidate, from Amplyx Pharmaceuticals (a Pfizer affiliate). Fosmanogepix is a clinical-stage, potentially first-in-class broad-spectrum antifungal treatment and Basilea plans to initiate Phase III trials in mid-2024. Deal consideration includes $37m in upfront payments and milestones of up to $496m ($110m to Pfizer, and $396m from previous agreements), of which the majority relates to regulatory and commercial milestone events, and tiered single-digit royalties. We view this as a favourable transaction for Basilea and note that it is in line with the company’s previously disclosed plans to expand its late-stage product pipeline. In our view, fosmanogepix represents a promising near-term commercial opportunity as the legacy portfolio matures, provided that the data continue to be supportive. As part of this new update, management has also provided revised full-year 2023 financial guidance. We will update our model and valuation to reflect this deal. Our 2023 and 2024 estimates are under review.