adult-close-up-eye-946727

Shining a light in eye care

BioLight Life Sciences 19 October 2016 Initiation

BioLight Life Sciences

Shining a light in eye care

Initiation of coverage

Pharma & biotech

19 October 2016

Price*

NIS12.88

Market cap

NIS33m

*Priced at 17 October 2016

NIS3.82/US$

Net cash (NISm) at 30 June 2016

36.7

Shares in issue

2.6m

Free float

46%

Code

BOLT

Primary exchange

TASE

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

(7.9)

0.8

(63.1)

Rel to TA-100

(6.1)

0.3

(60.1)

52-week high/low

NIS36.1

NIS12.4

Business description

Based in Israel, BioLight is an emerging ophthalmic company focused on the development and commercialisation of products and product candidates that address ocular conditions. Lead products IOPtiMate and VS-101 are directed towards the treatment of glaucoma.

Next events

Q316 results

November 2016

FDA guidance on IOPtiMate regulatory strategy

H216

Analysts

Pooya Hemami, CFA

+1 646 653 7026

Maxim Jacobs, CFA

+1 646 653 7027

BioLight Life Sciences’ key products are IOPtiMate, a laser-based surgical device to treat moderate to advanced glaucoma, and VS-101, an extended-dose drug implant in Phase I/IIa trials to treat glaucoma. IOPtiMate was launched mainly in the EU and China in late 2014 and a US strategy will be determined in H216. BioLight is also advancing TeaRx as a diagnostic product for dry eye syndrome (DES). The company had NIS36.7m in net cash at 30 June 2016 and we derive an rNPV valuation of NIS90.5-97.6m.

Year end

Revenue (NISm)

PBT*
(NISm)

EPS*
(NIS)

DPS
(NIS)

P/E
(x)

Yield
(%)

12/14

0.9

(30.1)

(8.91)

0.0

N/A

N/A

12/15

1.4

(25.1)

(6.96)

0.0

N/A

N/A

12/16e

1.7

(23.4)

(6.40)

0.0

N/A

N/A

12/17e

6.6

(33.8)

(11.82)

0.0

N/A

N/A

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

IOPtiMate aims safer advanced glaucoma treatment

IOPtiMate applies a CO2 laser to thin the sclera (sclerectomy) to lower intraocular pressure (IOP) without penetrating the eyeball. The company’s studies show it can reduce IOP by 45%, a level comparable to filtration surgery, a more invasive procedure with longer recovery times and well-known risks for adverse events. By causing less ocular trauma, IOPtiMate may carry a lower risk of complications. Launched in EU and China in late 2014, ex-US sales to date are NIS2.3m through H116. A US regulatory strategy will be determined following FDA guidance in H216.

VS-101 to address glaucoma eye-drop compliance

Eye-D VS-101, in US Phase I/IIa studies, is an in-office insertable product that provides the controlled release of latanoprost, a widely prescribed glaucoma drug, for up to 12 months. There is a strong unmet need for continuous-dosage glaucoma drug release platforms, as 20-60% of patients do not comply with their eye-drop regimen, potentially leading to disease progression. Whereas IOPtiMate is intended for patients with moderate to advanced glaucoma (5-10% of the disease population), we estimate Eye-D VS-101 could target as much as 30% of glaucoma patients (those with earlier disease stages), or up to 0.83 million people in the US. Uptake will be driven by safety/efficacy and patient comfort, and Eye-D VS-101 will need to compete with alternative extended dose products in development. Phase I/IIa data is expected in H117, and we anticipate a commercial launch in 2020.

Valuation: rNPV of NIS90.5-97.6m

Our BioLight valuation applies a risk-adjusted net present value (nNPV) model with a 12.5% cost of capital and includes prospects for IOPtiMate (accounting for 52% of our valuation using the mid-case of our NIS/$ range), VS-101 (35% of our mid-case valuation) and TeaRx (13%). We value BioLight at NIS90.5-97.6m. BioLight had NIS36.7m cash at 30 June 2016 and we expect it will need to raise NIS60m by YE18 to fund its R&D programmes and maintain operations. Positive VS-101 data and/or clarity on IOPtiMate US regulatory path could be positive catalysts.

Investment summary

Company description: Diverse portfolio of ophthalmic assets

Incorporated and based in Israel in 2005, BioLight is advancing IOPtiMate, a laser treatment device for glaucoma. It is also developing Eye-D VS-101 and TeaRx through consolidated subsidiaries in which it owns controlling positions, for glaucoma treatment and DES detection and monitoring, respectively. IOPtiMate was launched in the EU and China in late 2014 (sales to date of NIS2.3m through H116), and a US regulatory strategy will be determined in H216. VS-101, an extended-dose implant delivering sustained release of generic glaucoma drug, latanoprost, is in Phase I/IIa studies. TeaRx, a semi-quantitative multi-parameter in-office test for DES, could be launched in the US and EU in 2017. BioLight also holds a 48% stake in cancer diagnostics company, Micromedic Technologies, and consolidates this stake in its financial statements. A comprehensive analysis of Micromedic is beyond the scope of this report, but a more detailed review will follow in an update report. As of 30 June 2016, BioLight had an accumulated deficit since inception of NIS221.5m.

Exhibit 1: BioLight upcoming catalysts

Event

Timing

Guidance from FDA on regulatory pathway for IOPtiMate

H216

Eye-D VS-101 Phase I/IIa data

H117

TeaRx 510(k) clearance and US launch

2017

Event

Guidance from FDA on regulatory pathway for IOPtiMate

Eye-D VS-101 Phase I/IIa data

TeaRx 510(k) clearance and US launch

Timing

H216

H117

2017

Source: Edison Investment Research

Valuation: Pipeline rNPV of NIS90.5-97.6m reflects upside

Our pipeline rNPV of NIS90.5-97.6m applies a 12.5% cost of capital and assumes probability-weighted assumptions for the company’s IOPtiMate, VS-101 and TeaRX assets. IOPtiMate contributes about 52% to our valuation, with VS-101 contributing approximately 35%.

Financials: Further capital likely required in 2017

On 30 June 2016, BioLight held NIS36.7m in net cash (NIS36.3m cash and equivalents and NIS0.4m in short-term deposits) and its annualised operating cash burn rate has been NIS25-26m over the past 24 months (including NIS8-10m in Micromedic). While we expect IOPtiMate’s revenue to increase in coming quarters, we believe R&D and other operating costs to exceed such sales growth near term and we forecast the operating cash burn rate to increase to NIS31.7m in 2017 and NIS32.8m in 2018. We model that the company will need to raise NIS30.0m in both 2017 and 2018 to sustain its operations and R&D projects. For modelling purposes, we assign these financings to long-term debt.

Sensitivities: Development risks, competition, IP

In addition to development and regulatory risk, a key challenge will be convincing stakeholders of the benefits of its products vs competitors. Competing products are being developed for glaucoma and BioLight’s success will depend on the relative performance of its products. As the firm will seek partnerships for the distribution and/or marketing of its products, it is also reliant on securing timely relationships with third parties at favourable terms, and on the commercial execution capabilities of these collaborators. We expect BioLight will need to raise funds to sustain its operations and will be reliant on obtaining favourable terms. While our model accounts for these financings as long-term debt, the firm may need to issue equity instead, which could lead to significant dilution. The success of BioLight’s commercial products will depend on the company’s ability to defend the IP assets surrounding them. Since 2013 BioLight has invested NIS15.4m in Micromedic Technologies and has a 48% stake. While not contractually obliged to do so, it may continue to invest its resources into the company; however, our cash requirement forecasts do not include any such future funding.

Emerging products for ophthalmic sector

BioLight Life Sciences is advancing several products and technologies in the ophthalmic sector. IOPtiMate and Eye-D VS-101 aim to improve treatment options for glaucoma and TeaRx is a diagnostic product targeting DES. IOPtiMate is already being commercialized in Europe and China, and a US market regulatory trajectory is being planned for potential launch in 2018 or 2019. The company also has a 48% ownership position in an Israel-based cancer diagnostics company, Micromedic Technologies, but has no active involvement in its day-to-day operations. BioLight is focused on the activity of its wholly owned subsidiary, XL Vision, which owns large (often majority) equity stakes in subsidiaries covering most of the separate ophthalmic technologies and products advanced by the company, as shown below. BioLight has full control of the operations of ViSci, IOPtima, DiagnosTear and LipiCare subsidiaries, which hold its core ophthalmic programmes. BioLight is effectively entitled to 70% of the returns from the IOPtima subsidiary advancing IOPtiMate, and 97% of those from the ViSci subsidiary developing VS-101.

Exhibit 2: BioLight Life Sciences organisational structure

Source: Company reports

IOPtiMate for glaucoma

BioLight’s IOPtima subsidiary is advancing IOPtiMate, a surgical device intended for moderate to advanced glaucoma cases. Glaucoma is a series of ocular disorders characterized by optic nerve damage that results in a progressive and irreversible visual field loss. Glaucoma is often, but not always, caused by an elevated level in intraocular pressure (IOP)1, and persistent elevated IOP (ocular hypertension) can damage the ganglion cells2 travelling through the optic nerve either through mechanical (direct compression of the axonal fibres) or ischemic means (diminishing the vascular perfusion of the nerve). Progressive damage of the ganglion leads to progressive irreversible vision loss. IOP results from the dynamic between the production and outflow of fluid (aqueous humor, AH) in the anterior chamber (AC) of the eye. The primary drainage path for AH is through trabecular meshwork (TM) and into the Schlemm’s canal (SC).The predominant treatment approach for glaucoma is to lower IOP.

Approximately ~25-35% of patients with confirmed glaucomatous nerve injury have untreated IOP levels that fall within normal ranges (generally under 21mmHg). Such cases are referred to as normal-tension glaucoma (NTG), and the cause of nerve injury may be due to vascular dysregulation affecting nerve blood flow, or anatomical deformations or anomalies of the lamina cribrosa. Although IOP levels are considered within normal ranges, the current medical and surgical treatment of NTG continues to be aimed at lowering IOP as in other forms of open-angle glaucoma.

Light is focused on photoreceptors located on the retina, then the visual information is relayed electrically through retinal bipolar, horizontal and amacrine cells, before being transmitted to retinal ganglion cells, which travel through the optic nerve prior to reaching further downstream visual processing areas (i.e. optic chiasm, lateral geniculate nuclei and visual cortex of the brain).

Exhibit 3: Schematic diagram of eyeball

Exhibit 4: Schematic of anterior chamber angle

Exhibit 3: Schematic diagram of eyeball

Exhibit 4: Schematic of anterior chamber angle

The US National Eye Institute (NIH) estimates the US glaucoma prevalence is 2.7 million people. Over 120,000 Americans go blind each year from glaucoma, reflecting 9% to 12% of all blindness cases.

Current treatments for glaucoma

The first-line treatment for glaucoma, particularly open-angle glaucoma (OAG)3, involves the chronic (often lifelong) usage of topical eye-drop medications to lower IOP. We estimate that up to 80% of OAG patients use topical eye-drop therapy as their only treatment. While many active drug molecules used in glaucoma therapy are now generic, GlobalData estimated the topical glaucoma drug market at $2.4bn in 2013 across seven major markets (including the US and Japan).

Approximately 75% of glaucomas are open-angle glaucoma (OAG) and other 25% are closed-angle glaucomas (CAG), where IOP is sharply increased secondary to mechanical obstruction of the AC drainage angle. CAG is often treated with a laser iridotomy procedure, but many CAG patients will also require additional chronic IOP-lowering therapy.

Exhibit 5: Commonly prescribed topical medication classes for glaucoma

Drug class

Examples

Mechanism of action

Typical IOP reduction

Typical dosing

Prostaglandin F2α analogue (PGA)

Latanoprost, travoprost, bimatoprost, tafluprost

Increase outflow of AH through the uveoscleral tract

25-35%

Once daily

β-adrenergic receptor antagonist (β-blocker)

Timolol, levobunolol, betaxolol, carteolol

Decrease AH production

20-30%

Once or twice daily

Carbonic-anhydrase inhibitors (CAI)

Dorzolamide, brinzolamide

Decrease AH production

20-25%

Twice daily

α2-adrenergic receptor agonist

Brimonidine, apraclonidine

Decrease AH production, and increase outflow through uveoscleral tract

20-25%

Twice daily or thrice daily

Source: Edison Investment Research, Review of Optometry, Review of Ophthalmology

Combination drugs (often combining a β-blocker with a CAI or PGA) can provide further therapeutic efficacy. While topical medications may be enough for many patients, disease progression occurs in many others despite treatment, which may be due to insufficient IOP reduction by medications alone, or poor treatment compliance. These cases, reflecting up to 20% of glaucoma patients per year, typically require more complex medical procedures to better control IOP, which fall into either noninvasive glaucoma procedures (NIGPs), or for more advanced cases, invasive glaucoma surgeries. NIGPs do not penetrate into the eye and include laser procedures such as laser trabeculoplasty (LT), which direct lasers to the TM enabling it to drain fluid more effectively, and can reduce IOP by 20-30%. LT is a common second-line treatment for cases not adequately controlled with topical drugs, but can cause sometimes thermal burns that raise IOP (less of a concern with newer procedures like micropulse LT), and may require retreatment within two to five years.

Invasive surgery options; filtration surgery and drainage implants

Surgery is indicated when topical or NIGP treatment is not adequate, or for about 5-10% of patients. Traditionally, this involved filtration surgery (trabeculectomy), which creates a new drainage site to collect fluid from the AC. Trabeculectomy can reduce IOP by about 50%, but carries a fair risk of severe complications (retinal breaks, infection, etc.), and requires lengthy post-op recovery. Glaucoma drainage implants (GDIs), also called tube shunts, are increasingly displacing trabeculectomies, despite their own set of post-operative risks (including double vision). GDIs include a tube that shunts AH from the AC to an implanted plate. GDI examples include Alcon’s Ex-Press shunt, the Ahmed valve (New World Medical), and the Baerveldt Implant (Advanced Medical Optics). The Tube vs Trabeculectomy study (TVT), comparing tube shunt surgery to trabeculectomy4, found that the five-year success rate was higher in the tube group. The numbers of trabeculecotomies performed have decreased significantly over recent decades. In eyes without prior scarring, they decreased 52% from 54,224 between 1994 and 2003, and a further 52% (to 12 279) in 2012; in eyes with scarring, it decreased 48% (to 5,728) between 2003 and 2012.5

Gedde SJ, Schiffman JC, Feuer WJ, et al. Am J Ophthalmol. 2012 May;153(5):789-803.e2.

Arora KS, Robin AL, Corcoran KJ et al. Ophthalmology. 2015 Aug;122(8):1615-24. doi: 10.1016/j.ophtha.2015.04.015. Epub 2015 Jun 16.

MIGS bridge gap between laser and more invasive procedures

Minimally invasive glaucoma surgery (MIGS) devices are small (<1mm) devices inserted through incisions at or near the cornea to gain access to the AC and improve AH outflow. MIGS intend to provide durable IOP reduction with shorter surgical and recovery times, and are less traumatic to ocular tissue than trabeculectomy or GDIs. The market-leading MIGS at present is the iStent Trabecular Micro-Bypass, by Glaukos (GKOS, NYSE), FDA-cleared in 2012, which recorded $71.7m in 2015 sales (+57% y-o-y). The i-Stent is implanted into SC during a cataract surgery6 procedure, which creates a permanent conduit to the TM. Other MIGS products may also enter the MIGS market shortly. MIGS devices generally provide IOP reductions of up to about 20%. More advanced glaucoma cases, requiring higher IOP reductions, still require more invasive surgery.

Tseng et al. (JAMA. 2012 Aug 1;308(5):493-501) suggests up to 20% of patients requiring cataract surgery may also have glaucoma

IOPtiMate to provide robust IOP drop with minimal invasion

IOPtiMate uses a carbon-dioxide (CO2) laser-assisted sclerectomy (CLASS) to reduce IOP. BioLight believes CLASS provides a safer and more precise alternative to trabeculectomies and GDIs, with a lower risk of complications, shorter recovery times and fewer post-op office visits. Unlike GDIs and MIGS, IOPtiMate does not implant any foreign bodies, which can themselves promote inflammation. IOPtiMate (see provided video) aims to thin the sclera (sclerectomy) and reduce IOP without penetrating the eyeball, in an automated, uncomplicated up to ~30-minute outpatient procedure. After a section (flap) of sclera is temporarily lifted, the CO2 laser is applied beneath to thin the scleral wall underneath, and a surge is also applied at the SC area, providing a flow pathway for AH to percolate (into the region of ablated sclera) from the intact TM/SC. The infrared CO2 laser radiation is absorbed and blocked by aqueous solutions, which prevents the procedure from penetrating into the anterior chamber like other lasers used in eye care (eg. Argon, Nd-YAG, etc). We view the potential target market as the approximately 7% of glaucoma patients not adequately treated by topical drugs or NIGPs, or about 0.19 million people in the US.

Clinical data shows similar IOP reduction to trabeculectomy with fewer side effects

BioLight aggregated the results of prospective and retrospective clinical IOPtiMate studies in Italy, Spain, Switzerland, Russia, Mexico, India, and Israel. In these trials, subjects were monitored for IOP and adverse events for up to five years. While these open-label studies did not have direct trabeculectomy comparator arms, the aggregated results can be compared with trabeculectomy outcomes from the recent TVT study, although there are limitations to this comparison given the possible variances in methodology and approaches used by the investigators.

Exhibit 6: Comparion of IOPtiMate study with trabeculectomy surgery (from TVT study)

IOPtiMate arm

Trabeculectomy (from TVT study)

Baseline mean IOP

25.8 (n=100)

25.6 (n=105)

Mean one-year post-treatment IOP

13.5 (n=81)

12.7 (n=87)

Mean three-year post-treatment IOP

14.2 (n=41)

13.5 (n=68)

Mean five-year post-treatment IOP

14.3 (n=21)

12.6 (n=63)

Adverse event prevalence (%)

Early (<1month)

Shallow/flat anterior chamber

5.6

10.0

Choroidal detachment

2.8

13.0

Hyphema (bleeding in eye)

4.6

8.0

Wound leak

8.3

11.0

Adverse events after five years

Loss of two or more visual acuity lines (Snellen chart)

0.9

43.0

Encapsulated bleb

0.0

6.0

Cataract formation

18.0

79.0

Percentage of patients with at least one complication after five years

39.8

63.0

Source: Company reports; Gedde SJ, Herndon LW, Brandt JD et al. (2012); Gedde SJ, Schiffman JC, Feuer WJ et al. (2012)

Despite the limitations in analyses between different studies, the results suggest IOPtiMate provides a comparable reduction in IOP to trabeculectomy; in the above study, IOPtiMate showed a 45% IOP reduction at five years and 48% reduction after 12 months. The frequency and type of side effects was also lower with IOPtiMate, notably in patients having reduction of visual acuity.

IOPtiMate commercialisation underway in Asia and Europe

IOPtiMate commercialisation began in late 2014 or early 2015, after CE mark clearance and approval from the China Food and Drug Administration (CFDA) were obtained. It has been marketed primarily to eye surgeons and medical centers using third party distributors, and in strategic territories (including France and China), through a direct salesforce. Sales have occurred in China, Hong Kong, Poland, Hungary, Romania, Portugal, Peru, and Canada. Most sales to date originated from Asia and Eastern Europe, as the company believes these areas have higher unmet need for glaucoma surgeries than in Western Europe, where patients generally have easier access to treatment. Altogether, 2015 sales were NIS1.4m (US$0.36m) and H116 sales were NIS0.8m (US$0.21m). Gaining penetration for medical device makers, particularly those with minimal brand recognition, in emerging markets is challenging, given the need to educate stakeholders about the device and its applicability, the limited medical infrastructure outside of urban settings, and affordability issues. BioLight indicates it is still in the early stages of IOPtiMate commercialisation, and expects continued growth along the product cycle.

BioLight anticipates sales in Western Europe to ramp up in 2017, and is focusing on France, Germany and Italy. In these and other countries, BioLight expects that IOPtiMate procedures will apply existing reimbursement codes used for filtration surgeries. The company and its distributors market the device through two revenue models, where customers either:

purchase the unit outright (we estimate the sale price at between $50,000-75,000 per unit; this model is expected to drive the majority of sales in China and Eastern European markets); or

pay a per-procedure fee code (about $200 to $300 per procedure); this model is largely employed in Western Europe (and expected for the US). After about 225-275 procedures, the customer obtains ownership of the unit, but continues to pay per-procedure fees.

We assume that 7% of the total glaucoma populations in China (11.5 million) and Europe (4.2 million) reflect the annual group of patients being considered for advanced surgery and 80% of these, or about 0.88 million people, could be the target ex-US market for IOPtiMate. We assume IOPtiMate could achieve peak 20% share in Europe and 4% in China (assuming higher market fragmentation and more challenging access to care vs Europe); this drives our peak ex-US sales forecast of $21.4m in 2023. We note that BioLight sees massive potential for IOPtiMate in China, including its potential adoption for earlier glaucoma stages than would normally be considered for surgery in Western markets (where only 5-10% of patients undergo surgery). We use more conservative assumptions and will revisit them should China sales approach the firm’s targets.

US commercial pathway through de novo regulatory review

The firm intends to seek FDA review for a specific regulatory path for the IOPtiMate in H216. This would require either a premarket approval (PMA) application or a Class II (de novo) application. The de novo review process can apply for devices for which there is no existing FDA-cleared product that could be classified as a predicate device for establishing “substantial equivalency”. Depending on the FDA’s review of the risk profile of IOPtiMate, it could allow it to be reviewed as a Class II device (potentially allowing for a relatively less onerous 510(k) process for clearance), or as a Class III device, which would require the more rigorous requirements of the PMA process.

Once the regulatory pathway is determined, the company plans to proceed with the US studies required for clearance. We assume that the FDA will require a Class III PMA pathway, which would expand the scale of clinical studies required (vs a Class II pathway) and increase associated costs. US pivotal PMA study sizes of around 500 patients or more are common for glaucoma surgical devices. We assume that a 500-pt PMA-enabling study will start in H117, costing about $8m, and could lead to US clearance and launch in early 2020. If the FDA will accept the Class II approach instead, we would revise our estimate and potentially move up our US launch timeline. Our model assumes that 7% of the c 2.7 million US glaucoma patients could represent the target market. We assume that 80% could be IOPtiMate candidates, with IOPtiMate realising a peak 30% market share (assuming more focused targeting for US vs the comparably more fragmented European market), with $250 average per-procedure revenue; we forecast peak US sales of $21.9m in 2025.

Eye-D VS-101 insert for glaucoma

BioLight’s ViSci subsidiary is developing Eye-D, an in-office non-biodegradable insertable platform that provides for the controlled release of ophthalmic medications over time. The Eye-D is inserted into the outer quadrant of the lower lid conjunctiva to deliver a controlled amount of drug over three to 12 months. The initial Eye-D product, VS-101, is intended for glaucoma and elutes precise constant quantities of latanoprost, a widely used PGA glaucoma medication. There is a strong unmet need for continuous-dosage glaucoma medication delivery systems, given that many patients are elderly and may have difficulties applying topical eye drops properly each day. Okeke et al.7 determined that 50% of glaucoma patients do not adhere to their regimen 75% of the time, and other studies have found estimates of non-compliance are 23-60%.8 Poor treatment compliance is associated with worsening glaucoma progression. To date, we are not aware of a viable approved continuous-dosage glaucoma drug delivery system.

Okeke CO, Quigley HA, Jampel HD, et al. Ophthalmology. 2009;116:191–9

Abelson, MB, Stein L. Review of Opthalmology. 2014 April 2; https://www.reviewofophthalmology.com/article/a-recipe-for-better-patient-compliance Accessed 1 August 2016.

We estimate a continuous glaucoma drug delivery system such as Eye-D VS-101 could target up to 30% of the glaucoma population, or up to 0.83 million people in the US, reflecting those patients poorly compliant with topical medication. Eye-D VS-101 is intended to elute latanoprost free acid at a rate of 0.007 to 0.072 μg/day. When the amount of drug is depleted, the insert can be replaced with a new one. The company does not believe that the product would cause corneal irritation or dry eye (based on animal data), but this needs to be confirmed in human studies.

VS-101 is being developed under the 505(b)(2) regulatory pathway, so as a therapeutic drug rather than a medical device. Following successful preclinical data in rabbits, the company started a 70-pt Phase I/IIa study in 2014. Patients with OAG or ocular hypertension are divided into four groups, with three receiving VS-101 insert (at differing dose levels per group) in one eye and the control group receiving latanoprost eye drops once daily. The study will evaluate the safety and efficacy of three dose levels of sustained-release VS-101 after three months of treatment, compared to latanoprost 0.005% eye drops. Results are expected in H117 and, if positive, the company plans to complete a larger scale Phase IIb trial and then a pivotal Phase III. The ongoing Phase I/IIa study is taking longer than we would have anticipated, and we believe that recruitment for future VS-101 studies must be quicker to meet our 2020 commercial launch forecast in the US and EU.

BioLight intends to partner VS-101 with a major ophthalmic biopharma firm prior to starting pivotal studies. Under 505(b)(2), the applicant may rely on much of the existing data already established on latanoprost, and hence the pivotal study would likely be shorter and less costly than what would be required for an NDA or PMA. Our model assumes a 505(b)(2) pathway, with BioLight spending c $8m on VS-101 R&D across 2017 and 2018, before partnering the product prior to starting a Phase III study (funded by the partner) in late 2018. We expect BioLight to obtain a net 25% royalty on sales, and we assume the target market is 0.83m in the US. As we expect that competitors will also reach the extended-dose glaucoma market, we forecast 7% peak US penetration among this subgroup, with an average per-implant treatment price of $1,000 per eye (replaced annually9). This leads to peak global VS-101 revenues of $279m in 2026, or $69.8m in royalties to BioLight.

BioLight believes that VS-101 will be replaced every six months, but our model forecasts a more conservative yearly average replacement cycle (to factor in discontinuations and potential patient preferences for a longer use cycles).

Competition analysis for IOPtiMate and VS-101

Existing data shows that IOPtiMate can provide trabeculectomy-like IOP reductions and likely with fewer side effects, making it a potentially competitive alternative if marketed effectively and/or if future studies show similar data. However, GDIs are already displacing trabeculectomy and Exhibit 7 shows some emerging new treatments and MIGS and even NIGPs such as ultrasound (EyeOP1). These can broaden the scope of therapeutic modalities available to potentially compete with IOPtiMate. IOPtiMate’s success will depend on its competitive profile (IOP lowering capacity, ease of use, cost, side effect profile, duration of recovery, etc) vs alternative emerging treatments.

There are also emerging competitive products under development for extended-dose glaucoma treatment. Many extended-dose PGA-drug eluting platforms are in development, and several are at more advanced stages than Eye-D VS-101 and may reach the market more quickly. Allergan’s bimatoprost sr is in Phase III studies but requires a more invasive injection into the ocular globe (and not simply into conjunctiva, like VS-101); Envisia’s ENV515 and Glaukos’s iDose similarly use ocular injections. Some competing platforms use more recent approved PGA drugs like travoprost or bitamoprost. A less invasive extended-dose treatment alternative is the Helios insert (Forsight Vision5, acquired by Allergan in August 2016 for $95m plus milestones), which is a ring that rests on the ocular surface and elutes bitmatoprost. It is scheduled to enter Phase III trials in H216. Products inserted into the punctum (also relatively non-invasive) are Mati’s L-PPDs and Ocular Therapeutix’s OTX-TP. Ultimately, the success of VS-101 will depend on its competitive profile in terms of IOP-lowering and ease of application, patient comfort, compared to alternatives.

Exhibit 7: Selected emerging competing treatments for glaucoma

Product

Company

Stage or status

Description

Notes

Topical medications

Rhopressa (netarsudil)

Aerie Pharmaceuticals

NDA planned in Q316

Inhibits rho-kinase (ROCK) and lowers IOP by relaxing TM, and also inhibits norepinephrine transporter (NET) and lowers AH production

Comparable IOP control to PGAs but targets different site (TM); Higher rates of redness and corneal deposits

Roclatan (netarsudil/ latanoprost combination)

Aerie Pharmaceuticals

Phase III underway

Combines netarsurdil with approved PGA for stronger IOP-lowering potential

Phase IIb study had 34% decrease in IOP at 28 days, or c 7% lower than latanoprost

trabodenoson

Inotek Pharmaceuticals

Phase III underway

Selective adenosine A1 receptor (ADORA1) agonist, intends to improve AH outflow at TM

335-pt Phase III study ongoing (data in Q416)

Vesneo (latanoprostene)

Nicox SA / Valeant

Registration

PGA (increases uveoscleral outflow) that also donates Nitric oxide, which may increase TM AH outflow and improve ocular blood flow

FDA CRL received in July 2016 citing cGMP manufacturing issues

AMA0076

Amakem

Phase II

Inhibits ROCK and lowers IOP by relaxing TM

Potentially lower eye redness (vs other ROCK inhibitors)

Glanatec (ripasudil)

Kowa

Approved in Japan (2014)

Inhibits ROCK and lowers IOP by relaxing TM

Approved for twice-daily dosing in Japan

bamosiran (SYL040012)

Sylentis SA (Zeltia)

Phase II

Topical RNAi-based therapy that blocks production of the β2-adrenergic receptors

180-pt Phase II did not show non-inferiority vs timolol

Extended-dose platforms

bitamoprost sr

Allergan

Phase III underway

Biodegradable, intracameral (injection into anterior chamber (AC) angle) implant providing gradual release of bimatoprost (a PGA)

In Phase I/II study (n=75), a single administration maintained IOP reduction in 92% of patients at 4 months

ENV515 (travoprost XR)

Envisia Therapeutics

Phase II underway

Biodegradable proprietary nanoparticle formulation of PGA travoprost, injected into AC, aiming for lower IOP for up to 6 months per dose

Interim 3-month analysis of low dose arm (n=5), showed sustained IOP reduction of 27% vs baseline

Helios insert

Forsight Vision5 (Allergan)

Phase II

Non-invasive ring that rests on ocular surface (under the eyelids) and slowly releases approved PGA (bimatoprost) over several months

Non-invasive nature of device a potential differentiator; Phase III study planned in H216; 130-pt Phase II study showed mean IOP reduction of 4-6mmHg at 12 weeks

iDose

Glaukos

Phase II

Implant that is injected and secured in the AC, and designed to provide a sustained release of a PGA (travoprost)

US Phase II study (planned n=300) commenced in H116

L-PPDS

Mati Therapeutics

Phase II

Punctal plug (placed in nasolacrymal duct) that slowly elutes PGA drug latanoprost

120-pt Phase II underway (data in H216) assessing effect on IOP at 12-wks

OTX-TP

Ocular Therapeutix

Phase III planned

Depot placed non-invasively into punctum and designed to slowly deliver PGA travoprost onto ocular surface for up to 90 days

Phase III studies guided to start in Q316

Non-invasive glaucoma procedures (NIGPs)

EyeOP1

Eyetech Care SA

CE Mark cleared (2011)
and approved in China

Uses ultrasound waves to partially deactivate the processes in the ciliary glands that produce AH, in a five-minute procedure.

CE-Mark clearance in 2015 to treat surgery-naïve glaucoma; US regulatory strategy not finalised

Minimally-invasive glaucoma surgery (MIGS)

CyPass Micro-stent

Transcend Medical (Novartis)

Approved in EU; PMA filed in October 2015

Micro-stent implanted in supraciliary space, and designed to reduce IOP by enhancing AH outflow to the suprachoroidal space

500-pt US pivotal trial on cataract surgery patients, showed significantly higher portion of treated patients had >20% IOP drop vs baseline at one and two years post-op

Hydrus Microstent

Ivantis

550-pt US pivotal study underway

Inserted during cataract surgery into SC, and then expands and opens into a scaffold that opens the channel to improve AH outflow

European study (n=100) in patients undergoing cataract surgery, showed 80% of the treatment group (Hydrus) achieved a >20% IOP vs 46% of control group (p=0.0008).

iStent Inject

Glaukos

Approved in EU; US pivotal study underway

About one-third the size of iStent, and uses similar approach to improve AH outflow into SC in patients undergoing cataract surgery.

A second version, in pivotal trials, does not require incision and can be for patients not undergoing cataract surgery.

iStent Supra

Glaukos

Approved in EU; US pivotal study underway

Drains AH into suprachoroidal space in the eye, and designed to be used in conjunction with cataract surgery.

Internal study showed 30% IOP reduction at 12 months vs un-medicated baseline.

Xen Gel Stent

AqueSys (Allergan)

Approved in EU; US pivotal study underway

Soft collagen-derived, gelatin implant that intends to facilitate AH outflow into subconjunctival space and thus bypass any TM/SC obstructions.

Allergan expects approval by FDA approval by YE16 or early 2017 via the 510(k) pathway.

Source: Company reports, Biocentury

TeaRx for dry eye detection

BioLight’s DiagnosTear subsidiary is advancing TeaRx, a rapid, semi-quantitative, point-of-care (POC) diagnostic providing a multi-assay analysis of tear film constituents to identify and monitor patients with DES. DES is a multifactorial, chronic and potentially progressive condition affecting up to 20 million people in the US10 where the eye produces insufficient tears or tears with unbalanced composition.11 DES was traditionally identified with staining dyes (showing diseased corneal epithelial cells), tear break-up time (evaporation time for the aqueous tear film layer) or through disposable test-strip markers (which measure tear volumes). However, these approaches have limitations, as they are subjective and test results do not correlate well with DES symptoms (eg. eye burning/irritation, light sensitivity, unstable vision, tearing, etc.) in many patients.

International Dry Eye WorkShop. 2007 report of the International Dry Eye WorkShop (DEWS). Ocul Surf.

2007;5:61-204.

Tears are composed of three layers: the lipid, aqueous and mucin components. Deficiencies or excesses in these components can cause DES symptoms.

Recent diagnostic tools include TearLab’s (TEAR, NASDAQ) Osmolarity System, which measures tear osmolarity. The TearLab system, launched in the US in 2009, consists of a core analysis device costing about $9,500 and per-use detection cards that cost about $10-15 each. TearLab recorded $25.2m in sales in 2015 (+28% y-o-y). However, its high cost limits its penetration among eye care clinics, and challenges have arisen with regard to reproducibility and interpretation.12 Other DES tear biomarkers have emerged, such as inflammatory marker matrix metallopeptidase 9 (MMP-9). InflammaDry (RPS) is marketed as a rapid, low-cost ($15 per use) disposable in-office device that screens the tear film for elevated MMP-9. Low lactoferrin levels are also correlated with DES.

Exhibit 8: Selected newer-generation DES detection devices

Product name

Company name

US regulatory status

Marker(s) identified or measured

US core analysis device cost and per-use costs

Notes

Osmolarity System

TearLab

510k-cleared; CLIA waiver

Tear osmolarity

Approx $9,500 ; approx. $15

$25m in 2015 revenue

InflammaDry

RPS Inc.

510k-cleared; CLIA waiver

Matrix metallopeptidase 9 (MMP-9)

N/A ; approx. $15

Not a quantitative measure

TearScan

Advanced Tear Diagnostics

510k-cleared; CLIA Class II

Lactoferrin or Immunoglobulin E

Approx $5,000; approx $10

Separate consumables needed for each marker

i-Pen

i-Med Pharma

Not yet cleared

Tear osmolarity

N/A

LacriPen

Lacrisciences LLC

Not yet cleared

Tear osmolarity

N/A

Source: Edison Investment Research, company reports

TeaRx evaluates multiple biomarkers to provide composite data

TeaRx is differentiated from the above DES diagnostic tools in that it provides a semi-quantitative objective measure (ie a scale of up to eight different ranges) of three separate biomarkers using a single 2μL patient sample of tear film. The system is relatively low cost as it does not require a dedicated core analysis system (unlike the TearLab or the TearScan systems, for instance).

TeaRx consists of a reusable tear collector (likely costing under $100), with single-use consumables being disposable sterile cartridges and multichannel test cassettes (MTCs); the company estimates that the combined cost of the provider of the per-use consumables (disposable cartridge and MTC), would be $10-20. After collecting 2μL of tears and performing test procedures (diluting, applying reagent, etc) and waiting about 10 minutes, a scaled score results for each of the three biomarkers. TeaRx also combines the score of the three biomarkers into a single DES severity composite score. The company has not publicized which specific biomarkers are used, since it is still obtaining patents to them. The semi-quantitative approach could be used to compare results at different time periods to monitor the efficacy of a chosen treatment regimen,13 and in measuring multiple biomarkers, TeaRx can potentially better differentiate the differing possible causes for DES in a given patient. The product may offer more specific diagnostic information than existing DES tests and BioLight believes that it can engage drug development firms to utilise TeaRx as a companion diagnostic test for emerging DES treatment candidates. However, the TeaRx procedure involves multiple steps and requires about 10 minutes. We do not expect TeaRx to substantially displace most existing DES diagnostic measures (including osmolarity), but it can serve as an additional POC tool for practitioners to use to detect or monitor DES and/or treatment efficacy.

DES is treated through a number of means, including lubricants, lid hygiene, meibomian gland expression, dietary fatty acid intake, doxycycline, and approved topical medications like cyclosporine and lifitegrast.

Clinical studies show proper DES identification

The company conducted two US clinical studies comparing TeaRx’s composite DES diagnostic measure with a composite of four established legacy DES assessment tests. The first study assessed about 200 US patients and results reported in 2015 indicated a strong positive correlation between TeaRx and the four applied tools. A second prospective study of 74 patients comparing TeaRx to a similar composite was completed in Q116 and showed a sensitivity of 86%, specificity of 87% and a positive predictive value of 87% for the TeaRx multi-assay test. These values appear favorable as they exceed the data obtained by TearLab as part of its 510(k) submission (64% sensitivity, 71% specificity). However, we believe TeaRx’s commercial appeal will depend on which specific biomarkers it measures.

BioLight met with FDA in July 2016 and provided a pre-IDE submission, which it believes can lead to FDA 510(k) regulatory clearance in 2017. The company believes that even if an additional clinical study is required, it could launch TeaRx in US and EU in 2017 or early 2018. For optimal US market reach, we believe the test would also need to obtain a CLIA (Clinical Laboratory Improvement Amendments) waiver, as any person performing laboratory tests on human specimens for diagnosis is required to have a CLIA certificate. Obtaining a CLIA waiver would make it easier for clinicians to fulfil this requirement to use TeaRx. Our model assumes that of the 140 million US annual eye care provider patient visits,14 10% will involve DES screenings with 25% of those involving more involved testing than staining dyes or test-strip markers; of these, TeaRx will obtain a maximum market share of 15% and, with $15 in average revenue per eye per test, lead to peak sales (2024) of $19.8m. We believe there is the possibility for higher peak penetration if reimbursement coverage through public or private insurers can be secured for TeaRx testing.

US Centers for Disease Control. National Ambulatory Medical Care Survey: 2012 State and National Summary Tables.

OphRx and Lipitear can provide additional growth

In 2015, BioLight invested $0.5m in OphRx (and now owns 40%), which is developing topical drops based on a non-invasive drug delivery technology that uses lyotropic liquid crystals (LLC). LLCs are believed to encapsulate active drug molecules and allow for controlled release to desired sites, potentially including to the back of the eye. OphRx is in the preclinical stage of development of OPH-101, a topical treatment for wet macular degeneration, and OPH-100, for DES. We await further advancement before including prospects in our model.

Lipitear lubricant eye drops for mild to moderate DES

In 2016, BioLight obtained worldwide rights (excluding Italy and Israel) from Fischer Pharmaceuticals and RAMOT (Tel Aviv University) to a topical lubricant eye drop (Lipitear) for DES. BioLight’s Lipicare subsidiary holds a license to develop additional potential products based on Lipitear's core technology. Lipitear has CE mark approval in Europe and BioLight is seeking clearance of the product as an OTC (over-the-counter) lubricant in the US, and potentially as a medical device or drug in China. Lipitear is comprised of microemulsions of tiny beads of aqueous solution enveloped by a lipidic surface, which can help protect the aqueous component from evaporation, potentially allowing for more sustained contact time and retention. However, several existing artificial tear products combine both aqueous and lipid or hydrophobic components to delay evaporation (including Novartis’s Systane Balance, Allergan’s Refresh Optive and Ocusoft’s Regaine MGD). Global Industry Analytics estimates the global artificial tear market would be worth $2.2bn by 2020 and the market is highly competitive, as MaxVal estimated there were over 25 OTC products available in the US in 2009. We believe strong marketing activities are needed to obtain commercial success and await further advancements on commercial or partnership strategy before incorporating the product in our forecasts.

Valuation

Our BioLight valuation includes the prospects for IOPtiMate, VS-101 and TeaRx. We apply a risk-adjusted net present value (nNPV) model with a 12.5% cost of capital. For each of these projects, we provide a weighted rNPV based on BioLight’s ownership in the associated parent company. For IOPtiMate, we apply a lower probability of success for our US forecasts than our ex-US market forecasts, as the product has yet to receive US regulatory clearance, while it is already cleared for sale in Europe and China. While our US peak sales forecasts are higher (vs ex-US), the lower probability and the longer time to market (discounting) explain why the US IOPtiMate rNPV contribution is lower. Our 70% probability adjustment factor for our ex-US IOPtiMate valuation reflects the commercial risk factors (market acceptance, execution) embedded within our ex-US forecasts. Eye-D VS-101 is the largest potential source of revenue for the company and our 20% probability of success estimate reflects its early clinical development stage.

Exhibit 9: BioLight Life Sciences rNPV assumptions

Product contributions (net of R&D costs)

Indication

rNPV (NISm)

rNPV/share (NIS)

Probability of success

Launch year

Peak sales (US$m)

IOPtiMate for ex-US Markets (70% weighted)

Glaucoma

88.7

34.01

70.0%

2015

21.4 in 2023

IOPtiMate in US Market (70% weighted)

Glaucoma

26.4

10.14

40.0%

2020

21.9 in 2025

Eye-D VS-101 (97% weighted)

Glaucoma

78.6

30.14

20.0%

2020

69.8 in 2026

TeaRx (80% weighted)

DES diagnosis

28.6

10.99

50.0%

2017

19.8 in 2024

Corporate costs & expenses

SG&A expenses

(57.2)

(21.94)

Net capex, NWC & taxes

(77.8)

(29.86)

Value of Micromedic shares (MCTC, TASE)*

6.4

2.44

Total rNPV

93.6

35.91

Net cash (debt) (Q216)

36.7

14.06

Total equity value**

130.3

49.97

FD shares outstanding (000) (Q216)

2,607

Source: Edison Investment Research. Note: *5.29m shares held with 17 October 2016 price of NIS1.21 per share; **excludes the impacts from any dilution resulting from any future equity offerings; based on current exchange rate.

BioLight’s current market capitalization is very close to its current net cash position (NIS36.7m on 30 June 2016), reflecting a near-zero market enterprise value. Our NIS90.5-97.6m pipeline rNPV assumption represents upside to BioLight’s current EV. The company believes that its key products (IOPtiMate, Eye-D VS-101, and TeaRx) have strong market opportunities in China. As per our usual policy on healthcare firms with early-stage operations or with plans to grow in China, we are cautious in our forecasts for this market in the absence of definitive newsflow or of commercial execution. If the firm can generate robust sales or form strategic partnerships in China, these could add significant value to our assumptions.

Sensitivities

Development and regulatory risk. BioLight’s leading pipeline products have not received regulatory clearance in the US and its strongest potential revenue contributor (Eye-D VS-101) has not yet reached late-stage clinical development.

Commercial and competition risk. The treatment landscape is evolving as competing products are being advanced for glaucoma, DES diagnostics and DES, and BioLight’s success will depend largely on relative performance.

Partnership risk. We expect that BioLight will seek a commercial partnership for Eye-D VS-101 and distributor relationships for IOPtiMate and TeaRx in targeted markets. Challenges to securing timely relationships, unfavorable partnership terms or sub-optimal commercial or marketing performance from collaborators or partners could adversely affect our forecasts.

Financing risk. While the company is generating revenue from IOPtiMate in ex-US markets, we forecast its R&D and operating costs to exceed total revenues, until Eye-D VS-101 is launched in 2020. We expect the company will need to raise NIS37.5m in 2017 and in 2018 to sustain operations and its R&D programs. While our model accounts for these financings as long-term debt, the company may need to issue equity instead, at a pricing that may not be favourable for current shareholders and could lead to significant dilution.

Intellectual property risk. The success of BioLight’s products will depend on its ability to defend the IP assets surrounding them. The patents surrounding VS-101 and IOPtiMate last through 2030 or 2031 and our forecasts assume market exclusivity through 2030 for both programs.

Ownership risk. The four largest shareholders (including company chairman) own 55% of shares outstanding, although based on BioLight’s public filings and sources, they are not considered as related parties. The company has a low free-float, which can impact trading liquidity.

Ownership of Micromedic. Since 2013, BioLight has invested NIS15.4m in Micromedic equity, increasing its stake over this period. It now owns 48% of the 10.95m outstanding Micromedic shares and, under its accounting guidance, has controlling ownership and consolidates Micromedic’s financial results. While BioLight has no contractual obligation to invest in Micromedic, based on past experience, it may continue to do so. BioLight’s CFO is also the CFO at Micromedic and the companies share certain office and administrative resources.

Financials

On 30 June 2016, BioLight held NIS36.7m in net cash (NIS36.3m cash and equivalents and NIS0.4m in short-term deposits) and its annualised operating cash burn rate (including the consolidation of Micromedic’s financials) has been NIS25-26m over the past 24 months; we estimate approximately NIS8-10m of the reported annual burn rate reflects Micromedic’s operations. Our forecasts (for H216 and beyond) do not include projections or considerations for Micromedic. We forecast IOPtiMate sales of NIS5.7m in 2017 and NIS11.7m in 2018 (with NIS0.9m and NIS5.7m in 2017 and 2018 TeaRx sales, respectively). SG&A costs are projected to rise from NIS8.2m in 2017 to NIS10.6m in 2018. We expect R&D costs over this period will be driven by Eye-D VS-101 and IOPtiMate US clinical studies, with R&D costs projected to rise to NIS27.6m in 2017 and NIS25.2m in 2018 (from NIS13.0m in 2015).

Hence, while we expect IOPtiMate revenue to increase in coming quarters, we believe R&D spending and other operating costs to exceed such sales growth near term and we forecast the operating cash burn rate to increase to NIS31.7m in 2017 and NIS32.8m in 2018. We model that BioLight will need to raise NIS30.0m in both 2017 and 2018 to sustain its operations and R&D projects. For modeling purposes, we assign these financings to long-term debt.

BioLight’s reported financials consolidate the results from Micromedic, although BioLight has no direct liability or obligation to it. Micromedic has near-zero revenue (under NIS0.05m per year) and had a 2015 segment loss of NIS8.3m. Our model does not include forecasts for Micromedic.

Exhibit 10: Financial summary

NIS(000)

2013

2014

2015

2016e

2017e

2018e

31-December

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

PROFIT & LOSS

Revenue

 

 

82

941

1,391

1,727

6,617

17,425

Cost of Sales

(23)

(538)

(734)

(711)

(2,978)

(7,841)

Sales, General & Administrative

(9,016)

(8,529)

(11,956)

(10,430)

(8,225)

(10,594)

Research & Development

(18,419)

(18,560)

(13,045)

(13,636)

(27,600)

(25,200)

EBITDA

 

 

(27,376)

(26,686)

(24,344)

(23,050)

(32,186)

(26,210)

Depreciation

(1,066)

(3,884)

(1,306)

(835)

(1,800)

(2,400)

Amortization

0

0

0

0

0

0

Operating Profit (before exceptionals)

 

(28,442)

(30,570)

(25,650)

(23,885)

(33,986)

(28,610)

Exceptionals

(1,220)

(5,886)

(2,475)

(5,133)

0

0

Other

0

0

0

0

0

0

Operating Profit

(29,662)

(36,456)

(28,125)

(29,018)

(33,986)

(28,610)

Net Interest

500

448

543

436

223

(364)

Profit Before Tax (norm)

 

 

(27,942)

(30,122)

(25,107)

(23,448)

(33,763)

(28,974)

Profit Before Tax (FRS 3)

 

 

(29,162)

(36,008)

(27,582)

(28,581)

(33,763)

(28,974)

Tax

0

0

0

0

0

0

Profit After Tax and minority interests (norm)

(17,617)

(17,216)

(16,784)

(16,691)

(30,851)

(27,824)

Profit After Tax and minority interests (FRS 3)

(18,837)

(23,102)

(19,259)

(21,824)

(30,851)

(27,824)

Average Number of Shares Outstanding (m)

1.4

1.9

2.4

2.6

2.6

2.6

EPS - normalised (NIS)

 

 

(12.87)

(8.91)

(6.96)

(6.40)

(11.82)

(10.63)

EPS - normalised and fully diluted (NIS)

 

(12.87)

(8.91)

(6.96)

(6.40)

(11.82)

(10.63)

EPS - (IFRS) (NIS)

 

 

(13.76)

(11.96)

(7.98)

(8.37)

(11.82)

(10.63)

Dividend per share (NIS)

0.0

0.0

0.0

0.0

0.0

0.0

BALANCE SHEET

Fixed Assets

 

 

13,323

8,002

9,832

7,552

10,184

16,074

Intangible Assets

12,307

7,106

6,869

6,751

6,751

6,751

Tangible Assets

1,016

896

2,963

801

3,433

9,323

Current Assets

 

 

21,009

32,432

53,439

28,062

24,661

16,848

Short-term investments

185

6,408

385

375

375

375

Cash

17,716

22,196

50,697

27,035

21,090

9,617

Other

3,108

3,828

2,357

652

3,196

6,855

Current Liabilities

 

 

(4,898)

(6,552)

(6,605)

(4,673)

(4,673)

(489)

Creditors

(4,898)

(6,552)

(6,605)

(4,673)

(4,673)

(489)

Short term borrowings

0

0

0

0

0

0

Long Term Liabilities

 

 

(7,325)

(8,144)

(9,605)

(9,941)

(39,941)

(69,941)

Long term borrowings

0

0

0

0

(30,000)

(60,000)

Other long term liabilities

(7,325)

(8,144)

(9,605)

(9,941)

(9,941)

(9,941)

Net Assets

 

 

22,109

25,738

47,061

21,000

(9,769)

(37,508)

CASH FLOW

Operating Cash Flow

 

 

(26,725)

(27,435)

(24,580)

(23,545)

(31,736)

(32,819)

Net Interest

500

448

543

436

223

(364)

Tax

0

0

0

0

0

0

Capex

(201)

(402)

(182)

(638)

(4,432)

(8,290)

Acquisitions/disposals

(37)

0

(837)

(227)

0

0

Financing

11,152

38,374

47,320

893

0

0

Net Cash Flow

(15,311)

10,985

22,264

(23,080)

(35,944)

(41,473)

Opening net debt/(cash)

 

 

(215)

(17,901)

(28,604)

(51,082)

(27,410)

8,535

HP finance leases initiated

0

0

0

0

0

0

Other

32,997

(282)

214

(592)

0

0

Closing net debt/(cash)

 

 

(17,901)

(28,604)

(51,082)

(27,410)

8,535

50,008

Source: Company reports, Edison Investment Research. Note: The reported financial results consolidate Micromedic’s financials, and forecast financial results (2016e and beyond) do not include Micromedic operations

Contact details

Revenue by geography

BioLight Life Sciences
Kiryat Atidim Building 3, 5
th floor
6158101 Tel Aviv, Israel
Phone: 972-73-2753400
http://www.bio-light.co.il

N/A

Contact details

BioLight Life Sciences
Kiryat Atidim Building 3, 5
th floor
6158101 Tel Aviv, Israel
Phone: 972-73-2753400
http://www.bio-light.co.il

Revenue by geography

N/A

Management team

Chief executive officer: Suzana Nahum Zilberberg

Chairman: Israel Makov

Suzana Nahum Zilberberg has been the CEO of BioLight since 2011. Previously she worked at Teva Pharmaceuticals Industries for 12 years in several positions, her last role being vice president Asia and Pacific. In her position, Mrs. Nahum Zilberberg led the joint-venture agreement with Kowa Pharmaceutical in 2008 and the acquisition of Taisho Pharmaceutical in 2009. She holds a BA in accounting and economics from Tel Aviv University, MBA in finance and marketing from Tel Aviv University and is certified CPA.

Israel Makov has been BioLight’s chairman since 2011 and is also the current chairman of Micromedic. From 2002 to 2007, Mr. Makov served as the president and chief executive officer of Teva Pharmaceutical Industries. Prior to joining Teva, Mr. Makov led a number of companies in various industries, including biotech company, Interpharms. Mr. Makov has been chairman of Given Imaging, Sun Pharmaceutical Industries and Eltav Wireless Monitoring. He holds a B.Sc. in agriculture and an MA in economics from the Hebrew University of Jerusalem.

Chief financial officer: Itai Bar-Natan

Itai Bar-Natan has been the company’s chief financial officer since 2013, and he also serves as the CFO of Micromedic. Prior to joining BioLight, Mr. Bar-Natan worked at Ernst & Young Israel and Ernst & Young US for 10 years in several positions, including senior manager in the high-tech practice. He holds a BA in accounting (with honours) and political science from the Tel-Aviv University and is a certified public accountant.

Management team

Chief executive officer: Suzana Nahum Zilberberg

Suzana Nahum Zilberberg has been the CEO of BioLight since 2011. Previously she worked at Teva Pharmaceuticals Industries for 12 years in several positions, her last role being vice president Asia and Pacific. In her position, Mrs. Nahum Zilberberg led the joint-venture agreement with Kowa Pharmaceutical in 2008 and the acquisition of Taisho Pharmaceutical in 2009. She holds a BA in accounting and economics from Tel Aviv University, MBA in finance and marketing from Tel Aviv University and is certified CPA.

Chairman: Israel Makov

Israel Makov has been BioLight’s chairman since 2011 and is also the current chairman of Micromedic. From 2002 to 2007, Mr. Makov served as the president and chief executive officer of Teva Pharmaceutical Industries. Prior to joining Teva, Mr. Makov led a number of companies in various industries, including biotech company, Interpharms. Mr. Makov has been chairman of Given Imaging, Sun Pharmaceutical Industries and Eltav Wireless Monitoring. He holds a B.Sc. in agriculture and an MA in economics from the Hebrew University of Jerusalem.

Chief financial officer: Itai Bar-Natan

Itai Bar-Natan has been the company’s chief financial officer since 2013, and he also serves as the CFO of Micromedic. Prior to joining BioLight, Mr. Bar-Natan worked at Ernst & Young Israel and Ernst & Young US for 10 years in several positions, including senior manager in the high-tech practice. He holds a BA in accounting (with honours) and political science from the Tel-Aviv University and is a certified public accountant.

Principal shareholders

(%)

Lau Ngai Cheung (Rock-One Group Investment Co.)

18.9

Shanghvi Dilip Shantila

14.0

Israel Makov

12.7

Dan Oren (Dexon Holdings Ltd.)

9.4

Phoenix Provident Funds

6.4

Companies named in this report

Advanced Medical Optics, Alcon (Novartis), Allergan plc, Forsight Vision5, Glaukos, Mati Therapeutics, Ocular Therapeutix, New World Medical, TearLab,

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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

245 Park Avenue, 39th Floor

10167, New York

US

Sydney +61 (0)2 9258 1161

Level 25, Aurora Place

88 Phillip St, Sydney

NSW 2000, Australia

Wellington +64 (0)48 948 555

Level 15, 171 Featherston St

Wellington 6011

New Zealand

Tel Aviv +44 (0)20 3734 1007
Medinat Hayehudim 60,

Herzilya Pituach, 46766

Israel

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