Currency in NZD
Last close As at 07/06/2023
NZD3.90
▲ 0.07 (1.83%)
Market capitalisation
NZD409m
Research: Healthcare
AFT Pharmaceuticals announced that its Pascomer Phase II clinical trial has failed to meet its primary endpoint of a two-point improvement on the Investigator’s Global Assessment (IGA) scale. Pascomer is AFT’s topical rapamycin formulation being evaluated as a treatment of facial angiofibromas (FA) associated with tuberous sclerosis complex (TSC). As a result, AFT’s US development partner and licensee, Timber Pharmaceuticals, has terminated its agreement with the company. Despite this setback, AFT maintains that the study showed ‘statistically significant benefits’ against the clinically relevant Facial Angiofibroma Severity Index (FASI) and a less rigorous one-point improvement on the IGA scale and plans to undertake further development activities on its own. Our estimates do not capture AFT’s research and development (R&D) programmes and this announcement therefore does not impact our valuation of the company (NZ$680.8m or NZ$6.50/share).
AFT Pharmaceuticals |
Pascomer falls short of FDA mandated threshold |
Clinical development update |
Pharma and biotech |
28 July 2022 |
Share price performance Business description
Analysts
AFT Pharmaceuticals is a research client of Edison Investment Research Limited |
AFT Pharmaceuticals announced that its Pascomer Phase II clinical trial has failed to meet its primary endpoint of a two-point improvement on the Investigator’s Global Assessment (IGA) scale. Pascomer is AFT’s topical rapamycin formulation being evaluated as a treatment of facial angiofibromas (FA) associated with tuberous sclerosis complex (TSC). As a result, AFT’s US development partner and licensee, Timber Pharmaceuticals, has terminated its agreement with the company. Despite this setback, AFT maintains that the study showed ‘statistically significant benefits’ against the clinically relevant Facial Angiofibroma Severity Index (FASI) and a less rigorous one-point improvement on the IGA scale and plans to undertake further development activities on its own. Our estimates do not capture AFT’s research and development (R&D) programmes and this announcement therefore does not impact our valuation of the company (NZ$680.8m or NZ$6.50/share).
Year end |
Revenue (NZ$m) |
PBT* (NZ$m) |
EPS* |
DPS |
P/E |
Yield |
03/21 |
113.1 |
8.2 |
7.1 |
0.00 |
N/A |
N/A |
03/22 |
130.3 |
18.9 |
19.2 |
0.00 |
N/A |
N/A |
03/23e |
155.9 |
27.0 |
20.4 |
4.04 |
N/A |
N/A |
03/24e |
194.2 |
43.5 |
30.0 |
5.94 |
N/A |
N/A |
Note: *PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments.
The Phase II clinical study was a randomised placebo-controlled study enrolling a total of 107 patients across three cohorts (38 in placebo group, 36 in Pascomer low-strength dose and 33 in Pascomer high-strength dose). The study compared changes in FA patients, treated with either placebo or Pascomer at low or high strength over a 26-week period. The US FDA mandated primary endpoint was a two-point improvement on the IGA scale. While Pascomer (both high- and low-dose cohorts) delivered higher responder rates than placebo on the less rigorous one-point improvement on the IGA scale with statistical significance (p<0.05), it could not reach statistical significance on the two-point improvement on the IGA scale. However, the study met all secondary endpoints – FASI, patient or physician rated improvement – across both high- and low-dose cohorts with statistical significance against placebo. Following this, US partner Timber has terminated its agreement with AFT and the company now plans to undertake further development and commercial activities on its own. However, Desitin Arzneimittel continues as the licensee partner for the FA orphan drug indication in Europe, Switzerland and UK.
As a reminder, TSC is a genetic disease afflicting over one million people worldwide, including 50,000 cases in the US. Over 70–80% of all TSC cases suffer from FA, which can cause adverse effects on appearance and in serious cases, impair breathing and vision. We had highlighted earlier that the recent FDA approval of Nobelpharma’s competing topical rapamycin formulation with an orphan drug designation (with the associated seven-year market exclusivity) would potentially affect Pascomer’s US commercial plans in FA and the company is likely to focus on larger non-orphan indications, such as port-wine stains. Our valuation does not capture any of the company’s ongoing R&D programmes, therefore remains unchanged at NZ$680.8m or NZ$6.50m despite the current development.
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Research: Industrials
Quadrise has signed a framework agreement with MSC Shipmanagement that covers proof-of-concept (POC) tests and subsequent letters of no objection (LONO) trials using both bioMSAR and MSAR from Quadrise on one or more commercial container vessels. These trials are essential preliminaries to Quadrise potentially supplying its proprietary fuels to MSC for use in its fleet, which is the largest container ship fleet in the world, thus helping MSC reduce its greenhouse gas emissions.
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