New data support holistic effects of ORY-2001

Oryzon Genomics 14 December 2017 Update
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Oryzon Genomics

New data support holistic effects of ORY-2001

Company update

Pharma & biotech

14 December 2017

Price

€2.70

Market cap

€92m

Net cash (€m) at end Q317 (including term deposits)

9.8

Shares in issue

34.2m

Free float

50%

Code

ORY

Primary exchange

Madrid Stock Exchange

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

29.6

29.0

(41.0)

Rel (local)

27.0

30.4

(46.3)

52-week high/low

€4.97

€1.76

Business description

Oryzon Genomics is a Spanish biotech focused on epigenetics. ORY-1001 (Phase I/IIa) is being explored for acute leukaemias and SCLC; ORY-2001, its CNS product, is due to enter Phase IIa trials in AD and MS; while newer asset ORY-3001 is being developed for certain orphan indications.

Next events

Initiation of POC trials with ORY-1001 in selected indications

Q218

Start of Phase IIa with ORY-2001 in AD

Q118

Start of Phase IIa with ORY-2001 in MS

End-2017

Analysts

Jonas Peciulis

+44 (0)20 3077 5728

Alice Nettleton

+44 (0)20 3077 5700

Oryzon Genomics is a research client of Edison Investment Research Limited

Recently, Oryzon has published a flurry of fresh preclinical data backing its products ORY-2001 and ORY-3001. Latest data from ORY-2001 expanded the understanding about its diverse effects on Alzheimer's disease (AD) patients, potentially including a disease modifying effect. At ASH in December 2017 Oryzon revealed first preclinical data with ORY-3001 showing that the drug could be effective in sickle cell disease. The company also introduced its plans to continue the development of ORY-1001, its lead oncology asset, once it gets the rights back in early Q118, after Roche completes a dose-finding study with small cell lung cancer patients. Our valuation is €305m or €8.9/share (vs €8.6/share).

Year end

Revenue (€m)

PBT*
(€m)

EPS*
(€)

DPS
(€)

P/E
(x)

Yield
(%)

12/15

7.2

(0.1)

(0.01)

0.0

N/A

N/A

12/16

5.0

(4.7)

(0.17)

0.0

N/A

N/A

12/17e

4.7

(5.4)

(0.17)

0.0

N/A

N/A

12/18e

7.0

(5.6)

(0.16)

0.0

N/A

N/A

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

New preclinical data show multiple ORY-2001 effects

New preclinical data on ORY-2001 (Oryzon’s lead CNS asset) were presented at two separate conferences in October and November 2017. The first set demonstrated that in the well-established experimental autoimmune encephalomyelitis model for multiple sclerosis (MS), ORY-2001 performed as well as or better than fingolimod (Gilenya, Novartis) in reducing immune cell infiltration of CNS tissues, providing neuroprotection and thereby reducing demyelination. The next Phase IIa trial in MS patients is expected to start around end-2017. The second set of data from an AD animal model showed that ORY-2001 improved behavioural symptoms of AD patients such as aggression and social isolation, which is in addition to improving cognitive decline as reported in earlier studies. This indicates a wide holistic effect on AD. A Phase IIa in AD is expected to start in early Q118.

ORY-3001 for SCD; next trials for ORY-1001 revealed

The first published preclinical in vivo data on ORY-3001, Oryzon’s third asset, revealed it could be effective in sickle cell disease, which currently has no cure and has an adverse prognosis. This is in line with Oryzon’s intention to continue the development of ORY-3001 in certain orphan diseases. Finally, more details about the R&D plans for the lead oncology asset ORY-1001 include two clinical studies in both current indications – acute leukaemias and small cell lung cancer (SCLC) – with trials to start in early 2018.

Valuation: Multiple catalysts likely in early 2019

Our valuation is up slightly to €305m or €8.9/share, from €295m or €8.6/share. Oryzon’s Q317 financial results presented no surprises; the main effect on our valuation came from rolling our model forward, which was slightly offset by the lower net cash position. Preliminary data readouts from all four new trials are expected in early 2019 and all are key catalysts reachable with the current cash position.

ORY-2001 vs fingolimod in MS mouse model

While ORY-2001 has already established Phase I safety/tolerability data and now is progressing to two Phase IIa clinical trials for AD and MS, Oryzon has recently published new in vivo data supporting the development of the drug for these indications. The first set of data includes further preclinical findings about ORY-2001 in MS compared against fingolimod (Gilenya, Novartis) in the experimental autoimmune encephalomyelitis (EAE) mouse model. A more detailed analysis of ORY-2001’s previous preclinical PoC data can be found in our May 2017 Outlook. The new data was presented at MSParis2017 on 26 October 2017, a conference for both the European and Americas Committees for Treatment and Research in Multiple Sclerosis (ECTRIMS, ACTRIMS).

ORY-2001 was studied against Novartis’s MS drug fingolimod in the EAE mouse model in order to compare the effects of the two drugs in the effector phase of EAE. EAE is an accepted model for MS. The pathological CNS changes in mice that resemble MS are induced by the administration of myelin (fatty sheet that covers axon of nerve cells, essential for proper nerve functioning) proteins or peptides. This induces the production of myelin-specific CD4+ T cells, which ultimately leads to autoimmune reaction and demyelination. Immunized mice develop the disease within nine to 14 days (effector phase). A gradual demyelination leads to the development of different degrees of paralysis, mimicking the natural course of MS. Mice were either treated orally with ORY-2001 (n=10), fingolimod (n=10) or with vehicle (n=10). The treatment started from day 12 for five days (after the first clinical symptoms emerged until the time of sacrifice). The key findings of the study were:

Treatment with ORY-2001 reduced the severity of the disease and reduced mean clinical score significantly (which indicates a positive clinical effect), which was not the case in the fingolimod treated group (Exhibit 1).

Treatment with ORY-2001 and fingolimod similarly reduced CD4+ T cell infiltration in the spinal cord. Both drugs reduced the number of demyelination plaques in the cervical section of the spinal cord. Mice in the fingolimod arm did not have reduced demyelination plaques in the lumbar region.

Treatment with ORY-2001 and fingolimod resulted in a significant increase in the number of immune cells retained in lymph nodes but not in spleen in the case of fingolimod. Retention suggests a reduced egress of lymphocytes from immune tissues, which is usually associated with an inflammatory response.

Gene expression analysis of the spinal cord and brain samples showed similar gene changes after treatment with ORY-2001 vs fingolimod. Both drugs upregulated genes involved in neuroprotection and downregulated genes involved in inflammation and demyelination.

Treatment with ORY-2001 also caused a reduction of various pro-inflammatory cytokines.

Exhibit 1: Comparison of the mean clinical score of ORY-2001 and fingolimod (FTY720)

Source: Oryzon Genomics poster presentation. Note: Clinical score reflects the extent of the paralysis – 0 = no signs; 5.0 = hind and foreleg paralysis.

These new data show that in the well-established EAE model for MS, ORY-2001 performed as good as or better than fingolimod in the effector phase. These effects include reducing immune cell infiltration of CNS tissues, providing neuroprotection and thereby reducing demyelination. The therapeutic effect was achieved at clinically feasible dosages.

Fingolimod is a sphingosine-1-phosphate (S1P) antagonist currently marketed by Novartis for patients with relapsing-remitting MS. Its primary mechanism of action is via S1P receptors to reduce T cell infiltration to the CNS. However, there are additional therapeutic effects on the CNS; for example it was recently discovered that fingolimod is also involved in histone modification. Since its first launch in 2010, fingolimod (Gilenya) has performed well in the MS market (Exhibit 2).

Exhibit 2: MS market worldwide – Gilenya was the third best-seller in 2016

Source: Evaluate Pharma

Next steps with ORY-2001 in MS

At the end of October 2017, Oryzon received approval to start its next Phase IIa with ORY-2001 in the SATEEN study, “SAfety, Tolerability and Efficacy in an EpigeNetic approach to treat MS”. The trial is expected to recruit the first patient before the end of 2017. This will be a randomised, double-blind, placebo-controlled, three-arm, 36-week parallel-group study. The aim of the study is to evaluate the safety and tolerability of ORY-2001 in patients with relapsing-remitting MS and secondary progressive multiple sclerosis. In total 24 patients are expected to be enrolled and the preliminary readout is planned in early 2019.

ORY-2001 may improve behavioural symptoms in AD

In addition to ORY-2001 compared to fingolimod, Oryzon recently presented new preclinical data with ORY-2001 for AD suggesting that the drug could help to treat the behavioural symptoms. This follows previously reported data showing rescue of profound memory impairment; an analysis can be found in our May 2017 Outlook. The new data was presented at the Society for Neuroscience 47th annual meeting, Washington DC, on 11-15 November 2017.

The experiments were conducted with SAMP8 mice, which is a non-transgenic model for accelerated ageing and AD. The SAMP8 mice were treated with a range of clinically feasible doses of ORY-2001 or a vehicle. SAMR1 mice were treated with a vehicle only and acted as a normal control. The new data demonstrate ORY-2001’s effects on behavioural symptoms after six weeks of treatment using a so-called resident intruder (RI) test, which is an established test for aggression and evaluates the response of the test mouse to a new animal introduced in its environment. Gene expression analysis was then carried out on the mice’s prefrontal cortices. The main findings were:

ORY-2001-treated SAMP8 mice showed reduced aggression in the RI test measured by number of attacks and number of clinch attacks compared with SAMP8 control mice, to a similar level to the SAMR1 control mice (Exhibit 3).

ORY-2001 normalised pathological gene expression changes observed in SAMP8 mice (resembling those in AD) compared with SAMR1 mice, measured by a genome-wide microarray-based survey.

Exhibit 3: RI test showing reduced attacks and clinch attacks by ORY-2001-treated mice

Source: Oryzon Genomics poster presentation

The RI test was also conducted in the rat isolation model with ORY-2001. Rats are very social rodents and do not tolerate isolation. Rat isolation therefore was used as a model for social avoidance seen in AD patients. Rats were divided into control arm (three to four animals per cage) or isolated (one animal per cage). Isolated animal were treated with vehicle or ORY-2001 for five weeks; control animals were given vehicle. After that all animals were tested in the RI test. The findings were:

No aggressive behaviour was observed in the rats in either group, confirming the social nature of the animals.

Social avoidance measured by time without social interaction and number of evitations was significantly increased in isolated rats treated with vehicle, indicating the socially detrimental effect of the isolation. However, the treatment with ORY-2001 significantly improved both parameters.

Exhibit 4: RI test demonstrates ORY-2001’s efficacy in rat isolation model

Source: Oryzon Genomics poster presentation

These results suggest that ORY-2001 could have an effect on both cognitive decline and behavioural symptoms of AD. Specific treatments for behavioural symptoms such as aggression and social isolation are lacking and so tackling these could help to make ORY-2001 more competitive in the market. A large proportion of AD patients (20-50%) exhibit clinically significant aggression as a neuropsychological symptom. Currently this is managed by non-pharmacological as well as pharmacological means. There is no FDA approved specific medication for the treatment of aggression in AD. Memantine is the only drug approved for AD that has also been shown to reduce symptoms of agitation and aggression, whereas other drugs used are more general antipsychotics, antidepressants or anxiolytic drugs and often have unfavourable safety profiles.

Next steps with ORY-2001 in AD

The next step in the development of ORY-2001 for the treatment of AD is the Phase IIa study ETHERAL, “Epigenetic THERapy in ALzheimer’s Disease”. It will be a randomised, double-blind, placebo-controlled trial and will include 90 patients with mild to moderate AD. The study will consist of a screening period and a 26-week treatment period with open-label extension of another 26 weeks. The aim is to evaluate safety, tolerability and clinical effects. This trial is due to start in Q118 and due to end in Q419, but preliminary readout is planned in early 2019.

ORY-3001’s first preclinical data revealed

Another notable recent revelation was the first published preclinical data from preclinical studies with ORY-3001 (specific LSD1 inhibitor), Oryzon’s third lead product. The data showing ORY-3001’s efficacy in animal models of sickle cell disease (SCD) were presented at the American Society of Hematology (ASH) 59th annual meeting on 9-12 December 2017 in Atlanta, GA. This is in line with Oryzon’s intention to continue the development of ORY-3001 in certain orphan diseases.

There two types of haemoglobin: foetal (HbF) and adult. While HbF represents most of haemoglobin in foetal life, it drops to <1% in normal adults and is found in a few “F-cells”. The purpose of this study was to investigate whether ORY-3001 has the potential to increase HbF, which could replace the function of the mutated adult Hb. The results showed that oral administration of ORY-3001 increased HbF 10-fold in SCD transgenic mice. So called F reticulocytes (young red blood cells containing HbF) increased 300%. In baboons, F-reticulocytes increased 8-fold. As a next step Oryzon indicated that it will continue the development of ORY-3001 for SCD, although no specific details were announced.

SCD is a genetic disease where an adult gene for haemoglobin (a protein responsible for oxygen transport in red blood cells) is mutated resulting in abnormal shaped red blood cells, which resemble a sickle. This leads to anaemia and red blood cells being not able to pass through the smallest blood vessels, capillaries. This results in vaso-occlusive crisis, acute or chronic pain, and decreased supply of oxygen to organs, which causes damage and many other symptoms. Currently there is no cure and only symptomatic treatment is used. Hydroxyurea therapy is the only drug approved in the US for SCD to treat frequent and severe pain; however, it is not effective in a significant portion of patients. SCD is the most common inherited blood disorder with around 100k patients (emedicine.com) in the US alone and especially prevalent among African Americans, with up to 30% of people in some parts in Africa being heterozygotes for sickle cell mutated gene (carriers). The prognosis is rather adverse with median age of death being 42-48 years (emedicne.com).

Multiple key catalysts likely in early 2019

Oryzon is about to get back the rights from Roche for ORY-1001 (discussed in our previous report), once Roche finalises the dose-finding study in small cell lung cancer patients. Oryzon previously indicated that it planned to continue the development of ORY-1001 in both clinical-stage indications (Phase I dose finding data for SCLC; Phase I/IIa data for acute leukaemias). According to new details, the company plans to initiate a new Phase I/IIa study in SCLC and a follow on Phase IIa in acute myeloid leukaemia (AML), which could both start in Q218. This means that preliminary data readouts from all four trials with ORY-1001 and ORY-2001 are expected in early 2019 and all are key catalysts reachable with the current cash position.

Financials and valuation

Oryzon’s 9M17 financial update came in with no surprises. 9M17 R&D costs were €4.3m compared to €3.4m a year ago, while total operating costs were €7.1m versus €7.0m last year. We have somewhat fine-tuned our estimates for 2017 (mainly increasing the capitalisation of expenses via the revenue line [Oryzon follows local GAAP] and lowering other costs). 2018 estimates were affected due to revision of our R&D costs downwards as Oryzon indicated that the two new studies related to ORY-1001 could be smaller and aimed at generating a dataset that would be beneficial during the licensing negotiations (no further details have been provided so far). As previously, we still expect an increase in R&D costs next year related to the initiation of the new clinical trials.

Exhibit 5: Key changes to our financial forecasts

€m

2016

2017e

2018e

Actual

Old

New

Change (%)

Old

New

Change (%)

Revenue

5.009

4.381

4.742

+8%

7.906

7.014

-11%

Gross profit

5.009

4.381

4.742

+8%

7.906

7.014

-11%

R&D costs

(5.210)

(5.774)

(5.774)

0%

(13.577)

(8.502)

-37%

Operating profit (rep)

(4.578)

(6.061)

(4.883)

-19%

(10.875)

(5.005)

-54%

Profit before tax (rep)

(5.480)

(7.330)

(6.152)

-16%

(12.090)

(5.799)

-52%

Profit after tax (rep)

(5.448)

(7.330)

(6.152)

-16%

(12.090)

(5.799)

-52%

EPS reported (€)

(0.20)

(0.23)

(0.20)

-16%

(0.35)

(0.17)

-52%

Source: Oryzon Genomics accounts, Edison Investment Research

As Oryzon is on track to develop its assets in all the indications we currently include in our valuation, we maintain all our assumptions unchanged. Our new valuation is €305m or €8.9/share, marginally up from €294.9m or €8.6/share due to rolling our model forward, which was partially offset by a lower net cash position.

Exhibit 6: Oryzon rNPV valuation

Product

Indication

Launch

Peak sales*
(US$m)

Value
(€m)

Probability
(%)

rNPV
(€m)

rNPV/share
(€/share)

ORY-1001

AML

2023

930

244.4

15%

44.3

1.3

ORY-1001

SCLC

2026

570

119.3

8%

20.3

0.6

ORY-2001

AD

2026

4,510

891.1

15%

135.9

4.0

ORY-2001

MS

2027

1,940

395.5

20%

93.8

2.7

Net cash (FY17e)

11.0

100%

11.0

0.3

Valuation

 

 

1,661.3

305.4

8.9

Source: Edison Investment Research. Note: *Peak sales are rounded to the nearest US$10m, shown in US dollars. SCLC = small cell lung cancer; AML = acute myeloid leukaemia; AD = Alzheimer’s disease; MS = multiple sclerosis. Net cash includes term deposits.

Exhibit 7: Financial summary

€000s

2013

2014

2015

2016

2017e

2018e

December

Local GAAP

Local GAAP

Local GAAP

Local GAAP

Local GAAP

Local GAAP

PROFIT & LOSS

Revenue

 

 

2,360

15,536

7,185

5,009

4,742

7,014

Cost of Sales

0

0

0

0

0

0

Gross Profit

2,360

15,536

7,185

5,009

4,742

7,014

Research and development

(873)

(1,108)

(3,191)

(5,210)

(5,774)

(8,502)

EBITDA

 

 

(94)

11,659

688

(3,721)

(4,047)

(4,695)

Operating Profit (before amort. and except.)

(370)

11,398

448

(3,879)

(4,144)

(4,791)

Intangible Amortisation

(657)

(657)

(657)

(695)

(739)

(214)

Exceptionals

(186)

(4,617)

(24)

(4)

0

0

Other

0

0

0

0

0

0

Operating Profit

(1,213)

6,124

(233)

(4,578)

(4,883)

(5,005)

Exceptionals

0

667

(169)

(58)

0

0

Net Interest

(672)

(52)

(553)

(844)

(1,269)

(793)

Profit Before Tax (norm)

 

 

(1,042)

11,346

(105)

(4,724)

(5,413)

(5,584)

Profit Before Tax (reported)

 

 

(1,885)

6,739

(955)

(5,480)

(6,152)

(5,799)

Tax

89

(88)

(37)

32

0

0

Profit After Tax (norm)

(953)

11,258

(142)

(4,692)

(5,413)

(5,584)

Profit After Tax (reported)

(1,796)

6,651

(992)

(5,448)

(6,152)

(5,799)

Average Number of Shares Outstanding (m)

23.0

23.3

24.7

27.6

31.3

34.2

EPS - normalised (€)

 

 

(0.04)

0.48

(0.01)

(0.17)

(0.17)

(0.16)

EPS - reported (€)

 

 

(0.08)

0.29

(0.04)

(0.20)

(0.20)

(0.17)

Dividend per share (€)

0.0

0.0

0.0

0.0

0.0

0.0

Gross Margin (%)

100.0

100.0

100.0

100.0

100.0

100.0

EBITDA Margin (%)

N/A

75.0

9.6

N/A

N/A

N/A

Operating Margin (before GW and except.) (%)

N/A

73.4

6.2

N/A

N/A

N/A

BALANCE SHEET

Fixed Assets

 

 

20,128

16,059

18,050

21,269

25,175

31,879

Intangible Assets

15,825

12,928

15,188

18,810

22,813

29,613

Tangible Assets

1,159

981

854

696

600

503

Investments

3,145

2,150

2,008

1,763

1,763

1,763

Current Assets

 

 

2,851

9,999

22,681

28,475

32,082

19,599

Stocks

2

9

4

8

6

7

Debtors

663

704

940

978

859

519

Cash

2,033

3,633

19,467

22,028

31,076

19,074

Other*

153

5,654

2,270

5,461

141

0

Current Liabilities

 

 

(2,724)

(3,969)

(5,296)

(7,597)

(8,726)

(8,746)

Creditors

(1,005)

(1,299)

(2,401)

(2,119)

(2,080)

(2,100)

Short term borrowings

(1,719)

(2,670)

(2,895)

(5,477)

(6,646)

(6,646)

Long Term Liabilities

 

 

(11,251)

(8,196)

(7,841)

(19,419)

(15,102)

(15,102)

Long term borrowings

(9,117)

(6,420)

(6,177)

(17,723)

(13,406)

(13,406)

Other long term liabilities

(2,134)

(1,776)

(1,664)

(1,696)

(1,696)

(1,696)

Net Assets

 

 

9,004

13,893

27,594

22,729

33,429

27,631

CASH FLOW

Operating Cash Flow

 

 

(113)

12,178

1,076

(4,536)

(5,235)

(5,129)

Net Interest

(672)

(52)

(553)

(471)

(1,269)

(793)

Tax

0

0

0

0

0

0

Capex

0

0

0

(28)

0

0

Acquisitions/disposals

(677)

798

0

0

0

0

Financing

0

0

14,725

287

16,853

0

Other**

(161)

(9,579)

605

(6,819)

1,847

(6,080)

Dividends

0

0

0

0

0

0

Net Cash Flow

(1,623)

3,345

15,853

(11,567)

12,196

(12,002)

Opening net debt/(cash)

 

 

7,180

8,803

5,458

(10,395)

1,172

(11,024)

HP finance leases initiated

0

0

0

0

0

0

Other

0

0

0

0

0

0

Closing net debt/(cash)

 

 

8,803

5,458

(10,395)

1,172

(11,024)

979

Source: Oryzon Genomics accounts, Edison Investment Research

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Copyright 2017 Edison Investment Research Limited. All rights reserved. This report has been commissioned by Oryzon Genomics and prepared and issued by Edison for publication globally. 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. Opinions contained in this report represent those of the research department of Edison at the time of publication. The securities described in the Investment Research may not be eligible for sale in all jurisdictions or to certain categories of investors. This research is issued in Australia by Edison Investment Research Pty Ltd (Corporate Authorised Representative (1252501) of Myonlineadvisers Pty Ltd (AFSL: 427484)) and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. The Investment Research is distributed in the United States by Edison US to major US institutional investors only. Edison US is registered as an investment adviser with the Securities and Exchange Commission. Edison US 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. As such, Edison does not offer or provide personalised advice. We publish information about companies in which we believe our readers may be interested and this information reflects our sincere opinions. The information that we provide or that is derived from our website is not intended to be, and should not be construed in any manner whatsoever as, personalised advice. Also, our website and 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 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. This document is provided 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.
Edison has a restrictive policy relating to personal dealing. 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. Edison or its affiliates may perform services or solicit business from any of the companies mentioned in this report. The value of securities mentioned in this report can fall as well as rise and are subject to large and sudden swings. In addition it may be difficult or not possible to buy, sell or obtain accurate information about the value of securities mentioned in this report. Past performance is not necessarily a guide to future performance. 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. 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 (ie 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. To the maximum extent permitted by law, Edison, its affiliates and contractors, and their respective directors, officers and employees will not be liable for any loss or damage arising as a result of reliance being placed on any of the information contained in this report and do not guarantee the returns on investments in the products discussed in this publication. FTSE International Limited (“FTSE”) © FTSE 2017. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under license. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.

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

295 Madison Avenue, 18th Floor

10017, New York

US

Sydney +61 (0)2 8249 8342

Level 12, 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

295 Madison Avenue, 18th Floor

10017, New York

US

Sydney +61 (0)2 8249 8342

Level 12, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world-renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisers and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting. Edison is authorised and regulated by the Financial Conduct Authority. Edison Investment Research (NZ) Limited (Edison NZ) is the New Zealand subsidiary of Edison. Edison NZ is registered on the New Zealand Financial Service Providers Register (FSP number 247505) and is registered to provide wholesale and/or generic financial adviser services only. Edison Investment Research Inc (Edison US) is the US subsidiary of Edison and is regulated by the Securities and Exchange Commission. Edison Investment Research Pty Limited (Edison Aus) [46085869] is the Australian subsidiary of Edison. Edison Germany is a branch entity of Edison Investment Research Limited [4794244]. www.edisongroup.com

DISCLAIMER
Copyright 2017 Edison Investment Research Limited. All rights reserved. This report has been commissioned by Oryzon Genomics and prepared and issued by Edison for publication globally. 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. Opinions contained in this report represent those of the research department of Edison at the time of publication. The securities described in the Investment Research may not be eligible for sale in all jurisdictions or to certain categories of investors. This research is issued in Australia by Edison Investment Research Pty Ltd (Corporate Authorised Representative (1252501) of Myonlineadvisers Pty Ltd (AFSL: 427484)) and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. The Investment Research is distributed in the United States by Edison US to major US institutional investors only. Edison US is registered as an investment adviser with the Securities and Exchange Commission. Edison US 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. As such, Edison does not offer or provide personalised advice. We publish information about companies in which we believe our readers may be interested and this information reflects our sincere opinions. The information that we provide or that is derived from our website is not intended to be, and should not be construed in any manner whatsoever as, personalised advice. Also, our website and 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 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. This document is provided 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.
Edison has a restrictive policy relating to personal dealing. 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. Edison or its affiliates may perform services or solicit business from any of the companies mentioned in this report. The value of securities mentioned in this report can fall as well as rise and are subject to large and sudden swings. In addition it may be difficult or not possible to buy, sell or obtain accurate information about the value of securities mentioned in this report. Past performance is not necessarily a guide to future performance. 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. 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 (ie 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. To the maximum extent permitted by law, Edison, its affiliates and contractors, and their respective directors, officers and employees will not be liable for any loss or damage arising as a result of reliance being placed on any of the information contained in this report and do not guarantee the returns on investments in the products discussed in this publication. FTSE International Limited (“FTSE”) © FTSE 2017. “FTSE®” is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under license. All rights in the FTSE indices and/or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept any liability for any errors or omissions in the FTSE indices and/or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written consent.

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

295 Madison Avenue, 18th Floor

10017, New York

US

Sydney +61 (0)2 8249 8342

Level 12, 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

295 Madison Avenue, 18th Floor

10017, New York

US

Sydney +61 (0)2 8249 8342

Level 12, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

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