pexels-photo-4021779

A potentially transformational acquisition

SUDA Pharmaceuticals 23 June 2021 Update
Download PDF

SUDA Pharmaceuticals

A potentially transformational acquisition

Development update

Pharma & biotech

23 June 2021

Price

A$0.05

Market cap

A$25m

A$1.30/US$

Net cash (A$m) at 31 March 2021 + offering

7.9

Shares in issue (post offering)

480.8m

Free float

83.8%

Code

SUD

Primary exchange

ASX

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

48.6

18.2

46.1

Rel (local)

42.2

8.9

16.6

52-week high/low

A$0.06

A$0.03

Business description

SUDA Pharmaceuticals has historically been a drug delivery company focusing on developing oro-mucosal spray versions of established medicines. It has the rights to ZolpiMist, the spray version of Ambien for insomnia, outside of North America. SUDA is also working on formulating an oro-mucosal version of anagrelide for the treatment of solid tumours, sumatriptan for migraine, cannabinoids for various conditions, as well as other projects. SUDA recently acquired a CAR-iNKT programme for haematological malignancies.

Next events

Progress on iNKT development

2021/22

Analysts

Maxim Jacobs

+1 646 653 7027

Jyoti Prakash

+91 981 880 393

SUDA Pharmaceuticals is a research client of Edison Investment Research Limited

SUDA recently announced that it will be licensing an invariant natural killer T (iNKT) cell therapy platform from Imperial College London that can be used in conjunction with chimeric antigen receptors (CARs) to target blood cancers. Specific financial terms are undisclosed but include an upfront fee, annual maintenance fees, milestones and a single-digit royalty. There are a number of potential benefits of CAR-iNKT, including the prospect of being an allogeneic ‘off-the-shelf’ therapy, significantly simplifying the manufacture of the therapy and its delivery to patients. The therapy is expected to enter the clinic in 12–24 months.

Year end

Revenue (A$m)

PBT*
(A$m)

EPS*
(A$)

DPS
(A$)

P/E
(x)

Yield
(%)

06/19

1.2

(2.4)

(0.02)

0.0

N/A

N/A

06/20

0.5

(4.7)

(0.03)

0.0

N/A

N/A

06/21e

0.5

(4.3)

(0.01)

0.0

N/A

N/A

06/22e

1.0

(6.6)

(0.01)

0.0

N/A

N/A

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

Potential benefits of CAR-iNKT

SUDA’s iNKT programme may have benefits over traditional CAR-T therapies, such as Yescarta, based on in vitro and in vivo testing. First, it can be allogeneic as acute graft versus host disease (GVHD) appears unlikely. CD19 targeting CAR-iNKT cells also appear effective against lymphoma in the brain, unlike CD19-targeting CAR-T. Finally, the dual targeting of CD1d and CD19 has been shown to improve the anti-tumour effect compared to CD19-targeting CAR-T alone.

NHL to be the initial indication

SUDA expects the first Phase I trial to be for the treatment of non-Hodgkin lymphoma (NHL). This is the indication for which Gilead’s CD19 targeting CAR-T, Yescarta (axicabtagene ciloleucel), is approved (Yescarta is approved for large B-cell lymphoma, which is a type of NHL). Yescarta reported US$563m in sales in 2020 for this indication (expectations are for over US$1bn in 2026).

The NHL market is large, with room for a new entrant

According to Evaluate Pharma, sales for NHL treatments totalled US$11.8bn in sales in 2020. While the CAR-T Yescarta has promising data with a 51% complete remission rate, the median duration of response is 9.2 months for all patients and 2.1 months if only a partial response is observed. Any improvement in the duration of response would be expected to help patients survive longer.

Valuation: A$26m or A$0.05 per basic share

We now value SUDA at A$26m or A$0.05 per basic share (A$0.05 per diluted share), from A$23m or A$0.06 per basic share (A$0.05 per diluted share). We are not yet including the CAR-iNKT programme in our valuation but intend to do so when it enters the clinic. Given the sales of similar products as well as recent acquisition activity in this space, the resulting change to our valuation could be meaningful. Our total valuation increase at this time is due to higher net cash following the A$3.7m June offering, while the value per share declined due to more shares outstanding.

Using iNKT cell therapy to treat blood cancers

SUDA recently announced it will be licensing an iNKT cell therapy platform from Imperial College London. Specific financial terms are undisclosed but include an upfront fee, annual maintenance fees, milestones and a single-digit royalty. The company has stated there should be no immediate material impact from signing the agreement.

Preclinical studies have shown that by introducing a CAR that targets CD19 into the iNKT cells, the iNKT cells can target both CD19 and CD1d. In vitro and in vivo testing has shown targeting CD19 and CD1d is more effective against tumours compared to targeting CD19 alone (as Gilead’s Yescarta does) in CD1d-expressing lymphomas. Animal testing also suggests a much greater ability to target lymphomas that have crossed into the brain. In all but one animal receiving a CD19-targeting CAR-T and all untreated animals, brain lymphoma was above the level of detection. However, brain lymphoma was eliminated in 13 out of 18 CAR-iNKT-treated animals. Additionally, a second remission of relapsing disease was seen in mice that initially went into remission then subsequently relapsed, indicating the therapy may have a prolonged effect. Due to these benefits, 90% of the animals treated with CAR-iNKT survived compared to 60% of those treated with CAR-T. Importantly, no acute GVHD was seen in any of the mice tested and weight increased across all groups (>10% weight loss is a sign of acute GVHD).1 Although much of the preclinical testing is complete, according to the company, perfecting the manufacturing process likely means human clinical testing will only start in 12–24 months. We will have a better idea of the clinical path for the programme when it gets closer to the clinic.

  Rotolo et al., Enhanced Anti-lymphoma Activity of CAR19-iNKT Cells Underpinned by Dual CD19 and CD1d Targeting. Cancer Cell (2018) 34, 596–610

A further advantage to the CAR-iNKT cells is that the competitive landscape is much smaller than for traditional CAR-T, which has hundreds of active programmes. There are only two competitors in the clinic; one is a company, the other a Chinese academic trial. The company is Kuur Therapeutics, which has three CAR-iNKT programmes either in or close to the clinic. Kuur’s most advanced programme is an autologous CAR-iNKT targeting GD2 in neuroblastoma in Phase I (it is completing the fourth dose level, 11 patients dosed so far). The fact that it is autologous (thus having a different manufacturing and convenience profile) and going after a solid tumour (rather than haematological cancers) suggests it is not a direct competitor with the SUDA programme. Kuur also has an allogeneic CD19 targeting CAR-iNKT, dubbed KUR-502, in a Phase I trial in haematological malignancies. Dose level 1 is expected to complete shortly. Kuur also has a GPC3 targeting CAR-iNKT dubbed KUR-503 in preclinical testing for hepatocellular carcinoma (liver cancer) with IND submission expected in H122. Importantly, Kuur is being acquired by Athenex for US$70m upfront and an additional US$115m in milestones. We believe this could be indicative of where SUDA’s programme may be valued once it is in the clinic.

Another company developing CAR-iNKT cells is AgenTus, a subsidiary of Agenus Therapeutics. Its lead programme, Agent-797, is in Phase I for haematological malignancies and COVID-19-related pneumonia. However, it is not a CAR construct but rather the allogeneic iNKT cells themselves. The company’s CAR-iNKT programme is preclinical with precise indications and targeting undisclosed.

SUDA’s initial focus will be on CD19-expressing cancers, specifically NHL, which has an incidence of 81,560 patients per year according to the National Cancer Institute. Approximately 30% of NHL tumours express CD1d,2 while the vast majority B cell malignancies express CD19 (80% of acute lymphoblastic leukaemias, 88% of B cell lymphomas and 100% of B cell leukaemias).3 Even if only 30% of the market can be addressed, it still leaves a rather large opportunity. According to Evaluate Pharma, sales for NHL treatments totalled US$11.8bn in 2020 (see Exhibit 1 for the top 10 selling drugs for NHL) and is expected to grow to US$25.0bn in 2026.

  Xu et al., Expression of CD1d and presence of invariant NKT cells in classical Hodgkin lymphoma. American Journal of Hematology. July 2010 85(7):539-41

  Poe et al., A c-Myc and Surface CD19 Signaling Amplification Loop Promotes B Cell Lymphoma Development and Progression in Mice. Journal of Immunology 2012 September 1; 189(5): 2318–2325

Exhibit 1: Top 10 drugs to treat NHL by sales in the indication in 2020

Product

Company

Generic name

Mechanism of action

First launch (WW)

2020 sales (US$m)

Rituxan

Roche

Rituximab

B-lymphocyte antigen CD20 antibody

1997

3,549

Revlimid

Bristol-Myers Squibb

Lenalidomide

Interleukin-6 antagonist; Natural killer cell stimulant; Natural killer T-cell stimulant; Tumour necrosis factor alpha inhibitor; Vascular endothelial growth factor inhibitor

2006

3,235

Imbruvica

AbbVie

Ibrutinib

Bruton’s tyrosine kinase inhibitor

2013

956

Yescarta

Gilead Sciences

Axicabtagene ciloleucel

B-lymphocyte antigen CD19 CAR-T cell therapy

2017

563

Imbruvica

Johnson & Johnson

Ibrutinib

Bruton’s tyrosine kinase inhibitor

2013

515

Gazyva

Roche

Obinutuzumab

B-lymphocyte antigen CD20 antibody

2013

499

Calquence

AstraZeneca

Acalabrutinib

Bruton’s tyrosine kinase inhibitor

2017

331

Bendeka

Teva Pharmaceutical Industries

Bendamustine hydrochloride

DNA alkylation; Guanine alkylation; Guanine at N7 and adenine at N3 alkylation; Guanine at N7 and O6 alkylation; Guanine at N7 and O6 methylation

2016

270

Adcetris

Takeda

Brentuximab vedotin

Tubulin polymerisation inhibitor; Tumour necrosis factor receptor superfamily member 8 antibody

2011

225

Polivy

Roche

Polatuzumab vedotin

B-cell antigen receptor complex-associated protein beta chain antibody; Tubulin polymerisation inhibitor

2019

180

Adcetris

Seagen

Brentuximab vedotin

Tubulin polymerisation inhibitor; Tumour necrosis factor receptor superfamily member 8 antibody

2011

172

Source: Evaluate Pharma. Note: WW = worldwide.

Although the CAR-T Yescarta had promising data with a 51% complete remission rate, the median duration of response is 9.2 months for all patients and 2.1 months if only a partial response is observed. Any improvement in the duration of response would be expected to help patients survive longer and prove to be a competitive advantage for a new entrant like SUDA. Additionally, as the process for the preparation of a Yescarta dose can take two to three weeks, time is lost waiting for the treatment to be ready. Hence the ‘off-the-shelf’ nature of the autologous CAR-iNKT programme would have a significant time/convenience advantage.

Importantly, pricing for Yescarta is US$373,000 per treatment and it achieved US$563m in sales in 2020, with expectations of exceeding US$1bn in sales by 2026, according to EvaluatePharma. Also, Yescarta was approved on the basis of a single-arm, open-label trial in 101 patients, which could indicate the size of the trial that SUDA would need to run to gain approval for the CAR-iNKT programme. Note that Gilead had acquired Yescarta through its purchase of Kite Pharmaceuticals for US$11.9bn in 2017.

Valuation

We have slightly adjusted our valuation for SUDA to A$26m or A$0.05 per basic share (A$0.05 per diluted share) from A$23m or A$0.06 per basic share (A$0.05 per diluted share). The increase in the total value is due to higher net cash following the offering in June. The value per share has declined due to more shares outstanding. We are not yet including the iNKT cell therapy platform in our valuation given its preclinical stage (standard Edison methodology), but intend to do so when it enters the clinic. Given the sales of Yescarta and the acquisition price for Kuur Therapeutics, the change in our valuation for SUDA could be quite meaningful.

Exhibit 2: SUDA valuation

Product

Main indication

Status

Probability of successful commercialisation

Approval year

Peak sales (A$m)

Economics

rNPV
(A$m
)

ZolpiMist

Insomnia

Registered (Australia) , pre-registration (other regions)

70%

2020

17.3

Double-digit royalties

17.9

Total

 

 

 

 

 

 

17.9

Net cash (as of 31 March 2021 + offering)

7.9

Total firm value (A$m)

25.8

Total basic shares – post offering (m)

480.8

Value per basic share (A$)

0.05

Options (m)

68.1

Total number of shares (m)

548.9

Diluted value per share (A$)

0.05

Source: Edison Investment Research

Financials

The company reported A$4.3m in cash at 31 March 2021 with operating cash burn of A$0.9m during the latest quarter (A$2.7m through the first nine months of the fiscal year). As mentioned, SUDA is raising an additional A$3.7m (before costs) through the issuance of 96.2m shares at A$0.038 per share to help fund development of the iNKT cell therapy platform. The raise announced on 22 June was heavily oversubscribed and is being carried out at a slight premium to the previous trading day’s (17 June) closing price of A$0.036 per share. The new shares will be issued on 29 June 2021. Due to the acquisition of the CAR-iNKT programme, we have increased our expected R&D spending for FY22 by approximately A$2m. We forecast an additional A$12.5m in financing through FY23.

Exhibit 3: Financial summary

A$'000s

2019

2020

2021e

2022e

Year end 30 June

AIFRS

AIFRS

AIFRS

AIFRS

PROFIT & LOSS

Revenue

 

 

1,219

533

485

1,041

Cost of Sales

0

0

0

0

Gross Profit

1,219

533

485

1,041

Sales, General and Administrative Expenses

(3,129)

(4,788)

(3,825)

(3,978)

Research and Development Expense

0

0

(500)

(3,000)

EBITDA

 

 

(1,878)

(4,112)

(3,618)

(5,937)

Operating Profit (before amort. and except.)

 

 

(2,349)

(4,684)

(4,248)

(6,568)

Intangible Amortisation

0

0

0

0

Other

32

143

222

0

Exceptionals

(6,277)

(5,938)

0

0

Operating Profit

(8,626)

(10,622)

(4,248)

(6,568)

Net Interest

(94)

22

(43)

(45)

Other

0

0

0

0

Profit Before Tax (norm)

 

 

(2,443)

(4,662)

(4,291)

(6,612)

Profit Before Tax (FRS 3)

 

 

(8,720)

(10,600)

(4,291)

(6,612)

Tax

925

656

0

0

Deferred tax

(0)

(0)

(0)

(0)

Profit After Tax (norm)

(1,518)

(4,006)

(4,291)

(6,612)

Profit After Tax (FRS 3)

(7,795)

(9,944)

(4,291)

(6,612)

Average Number of Shares Outstanding (m)

98.6

142.3

331.2

481.0

EPS - normalised (c)

 

 

(1.54)

(2.81)

(1.29)

(1.37)

EPS - Reported ($)

 

 

(0.08)

(0.07)

(0.01)

(0.01)

Dividend per share (c)

0.0

0.0

0.0

0.0

BALANCE SHEET

Fixed Assets

 

 

10,658

4,673

4,893

5,243

Intangible Assets

10,291

4,251

4,385

4,613

Tangible Assets

367

365

421

543

Other

0

57

87

87

Current Assets

 

 

5,595

2,035

7,017

8,051

Stocks

45

22

22

22

Debtors

1,121

869

62

104

Cash

4,314

977

6,727

7,719

Other

115

166

206

206

Current Liabilities

 

 

(1,349)

(2,022)

(1,513)

(1,513)

Creditors

(1,312)

(2,010)

(1,513)

(1,513)

Short term borrowings

(36)

(12)

0

0

Long Term Liabilities

 

 

(927)

(550)

(46)

(7,550)

Long term borrowings

(17)

(4)

(4)

(7,504)

Other long term liabilities

(910)

(545)

(42)

(47)

Net Assets

 

 

13,978

4,135

10,351

4,231

CASH FLOW

Operating Cash Flow

 

 

(2,495)

(2,884)

(3,819)

(6,019)

Net Interest

0

0

0

0

Tax

0

0

0

0

Capex

(1,384)

(388)

(484)

(489)

Acquisitions/disposals

0

0

0

0

Financing

8,095

0

10,071

0

Dividends

0

0

0

0

Other

0

0

0

0

Net Cash Flow

4,215

(3,272)

5,768

(6,508)

Opening net debt/(cash)

 

 

1,951

(4,260)

(961)

(6,723)

HP finance leases initiated

0

0

0

0

Exchange rate movements

0

0

19

0

Other

1996

-27

-26

0

Closing net debt/(cash)

 

 

(4,260)

(961)

(6,723)

(215)

Source: Company reports, Edison Investment Research


General disclaimer and copyright

This report has been commissioned by SUDA Pharmaceuticals and prepared and issued by Edison, in consideration of a fee payable by SUDA 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 2021 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 SUDA Pharmaceuticals and prepared and issued by Edison, in consideration of a fee payable by SUDA 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 2021 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

Share this with friends and colleagues