Sareum Holdings — SDC-1801 prepping to enter Phase II

Sareum Holdings (AIM: SAR)

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Research: Healthcare

Sareum Holdings — SDC-1801 prepping to enter Phase II

Sareum Holdings’ FY24 results summarised an active period for lead asset SDC-1801, a dual TYK2/JAK1 inhibitor, which successfully completed Phase I trials in Australia and is now undergoing preparatory work to commence Phase II studies, likely in psoriasis patients. The recently reported unblinded data noted robust pharmacokinetic (PK)/pharmacodynamic (PD) properties and reiterated the drug’s desirable safety profile. While Sareum had previously proposed a smaller Phase Ib study, the plan has pivoted to running a larger Phase II trial, which requires a long-term (c 16 weeks) toxicology study before initiation. Sareum recently secured £3.4m in equity funding and a further c £1m in R&D tax credits, which management believes will be sufficient to complete the Phase II preparatory activities and fund preclinical work on its second asset, SDC-1802. We believe Sareum will be seeking partnering opportunities to support Phase II development of SDC-1801.

Jyoti Prakash

Written by

Jyoti Prakash

Analyst, Healthcare

Healthcare

Sareum Holdings

SDC-1801 prepping to enter Phase II

Pharma and biotech

Spotlight - Update

12 November 2024

Price

24.75p

Market cap

£31m

Share price graph

Share details

Code

SAR

Listing

AIM

Shares in issue (including the 16.3m shares issued under the October 2024 offering)

124.7m

Gross cash at 30 June 2024
(excluding £3.4 from Oct 2024 equity raise)

£1.5m

Business description

Sareum Holdings is a UK-based drug development company, specialising in small molecule kinase inhibitors. Its lead programmes are TYK2/JAK1 inhibitors, SDC-1801 for autoimmune diseases and SDC-1802 for cancer. Sareum initiated clinical trials for SDC-1801 in Australia in May 2023 (Phase Ia), reporting positive top-line data in June 2024. Other programmes include the CHK1 inhibitor SRA737, which was out-licensed to an unnamed private US-based pharma company by co-development partner CRT Pioneer Fund LP in January 2024.

Bull

SDC-1801’s novel TYK2/JAK1 selectivity may be attractive to partners, pending clinical validation of efficacy.

First-in-class opportunity for SDC-1802 in multiple cancer indications.

Approval of Sotyktu provides regulatory feasibility for TYK2 inhibitors.

Bear

Potential funding challenges due to possible partnering delays affecting clinical progress of SDC-1801 and SDC-1802.

Safety and efficacy profile of combined TYK2/JAK1 inhibitors need to be proved in larger randomised trials.

Markets sought by SDC-1801 and SDC-1802 are highly competitive.

Analysts

Jyoti Prakash, CFA

+44 (0)20 3077 5700

Dr Arron Aatkar

+44 (0)20 3077 5700

Sareum Holdings is a research client of Edison Investment Research Limited

Sareum Holdings’ FY24 results summarised an active period for lead asset SDC-1801, a dual TYK2/JAK1 inhibitor, which successfully completed Phase I trials in Australia and is now undergoing preparatory work to commence Phase II studies, likely in psoriasis patients. The recently reported unblinded data noted robust pharmacokinetic (PK)/pharmacodynamic (PD) properties and reiterated the drug’s desirable safety profile. While Sareum had previously proposed a smaller Phase Ib study, the plan has pivoted to running a larger Phase II trial, which requires a long-term (c 16 weeks) toxicology study before initiation. Sareum recently secured £3.4m in equity funding and a further c £1m in R&D tax credits, which management believes will be sufficient to complete the Phase II preparatory activities and fund preclinical work on its second asset, SDC-1802. We believe Sareum will be seeking partnering opportunities to support Phase II development of SDC-1801.

Historical financials

Year
end

Revenue
(£m)

PBT
(£m)

EPS*
(p)

DPS
(p)

P/E
(x)

Yield
(%)

06/21

0.00

(1.7)

(2.3)

0.0

N/A

N/A

06/22

0.00

(2.6)

(3.2)

0.0

N/A

N/A

06/23

0.00

(4.0)

(4.7)

0.0

N/A

N/A

06/24

0.00

(4.6)

(4.2)

0.0

N/A

N/A

Source: Company data. Note: *EPS figures have been adjusted retrospectively for the 50:1 share consolidation in March 2022.

Positive Phase I data support further development

Sareum completed the three-part Phase I safety study (n=96) in June 2024 (with positive top-line data supporting once-daily dosing) and subsequent unblinded data in October 2024 provided further evidence of desirable PK/PD features (such as blood plasma levels significantly higher than predicted therapeutic levels and long drug half-life) and a supportive safety profile (adverse events similar to placebo and no clinically significant impact on any blood component, a key limitation of competing therapeutics in development, such as brepocitinib). The focus in now on completing toxicology studies required to initiate the Phase II trial. While several TYK2 candidates are under development, management believes SDC-1801’s dual TYK2/JAK1 inhibition could potentially improve efficacy, while having an improved safety profile over brepocitinib, the leading dual TYK2/JAK1 inhibitor.

Latest funding provides headroom to Phase II

Sareum recently raised gross proceeds of £3.4m from a private placement, by issuing 11.8m shares at 20p/share and an additional 4.4m shares at 22.5p/share. Management believes that this, alongside the A$1.9m (c £1m) in R&D tax credits received from Australian authorities, will be sufficient to complete preparatory activities for the Phase II trial as well as translational and preclinical work on SDC-1802, Sareum’s other TYK2/JAK1, focusing on oncology indications. We expect the completion of toxicology studies to support more meaningful partnering/licensing discussion by Sareum for SDC-1801’s next phase of development. The TYK2 space has generated significant interest from the market, evidenced by deals such as Takeda’s US$4bn acquisition of Nimbus Therapeutics’ NDI-034858.

A focused product pipeline

Sareum is a development-stage company specialising in oral formulations of small molecule kinase inhibitors, with an initial focus on autoimmune and cancer indications. While the company has two novel in-house tyrosine kinase 2/Janus kinase 1 (TYK2/JAK1) assets in development, SDC-1801 and SDC-1802, the current focus in on progressing the former through early clinical development and, potentially, an out-licensing/partnering deal thereafter. In September 2024, the company strengthened SDC-1801’s intellectual property position with patent allowances in the US (related to chemical structure, usage in treating inflammatory diseases and in certain methods of chemical synthesis) and China (related to certain crystalline forms).

The third development programme in the pipeline is SRA737, a CHK1 inhibitor targeting the DNA damage response network for treatment of solid tumours. Sareum holds a 27.5% economic interest in SRA737 (Exhibit 1).

Exhibit 1: Sareum’s development pipeline

Source: Sareum corporate presentation, October 2024

SDC-1801 marches towards Phase II studies

Sareum’s core focus over the past year has been on progressing lead asset SDC-1801 through Phase I, which commenced in June 2023 and was read out in June 2024, reporting positive top-line data. The Phase Ia study, undertaken in Australia, was a randomised, placebo-controlled trial (targeted n=96) evaluating safety, tolerability and PK/PD of SDC-1801 in healthy adults. The study included three parts: a single ascending dose (SAD) study (part 1), a multiple ascending dose (MAD) study (part 2) and a food effects study (part 3). Part 1 and part 3 of the study were completed in February 2024 and indicated a favourable safety profile, supporting once-daily oral dosing to achieve therapeutic drug levels in the bloodstream. These observations were confirmed by the top-line results, which included data from the MAD portion, reported in June 2024.

The positive fundings were supported by the release of the full unblinded data in October 2024, which noted that SDC-1801 continued to show a strong safety profile, with no serious adverse events or deaths and the frequency of adverse events similar to placebo. Importantly, no significant changes to any blood components such as blood counts or serum creatinine levels were observed. This is crucial, given the strong off-target toxicity and cardiovascular issues associated with the previous generation JAK inhibitors (leading to class-wide black box warnings), which was primarily attributed to their lack of selectivity for the isoforms. We note that JAK2 and JAK3 inhibition has been implicated as the reason for the off-target toxicities and black-box warnings.

The Phase I study also demonstrated favourable PK/PD. Management noted that SDC-1801 was able to achieve materially higher exposure in blood than predicted therapeutic levels, with a relatively long half-life (17–20 hours), which supports the potential of restricting the treatment to a convenient once-daily dosing (similar to deucravacitinib/Sotyktu). Unblinded data from participants in the multiple ascending dose cohort, who received SDC-1801 for 10 days, also demonstrated dose-dependent reductions in three biomarkers of JAK1 and TYK2 activity (Interferon gamma-induced protein 10, high-sensitivity C-Reactive Protein and interferon alpha), which are key mediators of major inflammatory pathways. The full clinical study report is expected in Q4 CY24.

Based on the Phase I readouts, management has decided to directly move to a Phase II trial (rather than a smaller Phase Ib study as planned previously), likely in psoriasis patients. The Phase II trial, which is likely to be a 12- to 16-week study, requires Sareum to undertake toxicology studies for a similar duration before proceeding to the trial. With funding in place through recent raises and tax credit receipts (discussed in detail later), we expect the toxicology studies to commence imminently, with management targeting completion by Q225 (Exhibit 2). We believe that Sareum also concurrently seeking to secure a licensing deal for SDC-1801 thereafter to support further clinical development work.

Exhibit 2: Sareum expected milestones in CY24–25

Source: Sareum corporate presentation, October 2024

TYK2/JAK1 dual inhibition provides differentiation…

SDC-1801 is an inhibitor of both TYK2 and JAK1 enzymes, both part of the JAK family of proteins (four isoforms – JAK1, JAK2, JAK3 and TYK2) recognised for their role in immune regulation. These isoforms are known for their role in facilitating downstream signalling of a number of extracellular, pro-inflammatory cytokines, which lack their own enzymatic activity (Exhibit 3).

Exhibit 3: JAK isoforms implicated in downstream signalling of selected cytokines

Source: Sareum corporate presentation, October 2024

An oral administration targeting multiple cytokine pathways, therefore, could offer theoretical advantages over biologics, which tend to target one particular cytokine (four classes of biologics are currently approved for psoriasis: TNF-α inhibitors, IL-12/23 inhibitors, IL-17 inhibitors and IL-23 inhibitors). For example, TYK2 mediates downstream signalling of IL-10, IL-12, IL-23 and type I interferons (IFNs), recognised for their role in driving autoimmunity and associated inflammation. We also note that JAK1 mediates signalling for a number of other cytokines, such as IL-6, IL-13, IL-27 and IL-35, and therefore believe that a dual kinase approach, such as that of SDC-1801, could potentially offer a broader applicability and efficacy in autoimmune diseases. This was reflected in a comparative analysis of clinical data presented by Sareum (Exhibit 4), which noted that dual TYK2/JAK1 inhibition (with brepocitinib) resulted in the highest proportion of patients achieving PASI75 (a 75% or greater reduction in the Psoriasis Area and Severity Index (PASI) score from baseline) after a 12-week treatment. We note, however, that while this comparison provided a directional view, it is not confirmatory given the differences in study designs and patient populations.

Exhibit 4: Percentage of patients achieving PASI75 after 12 weeks

Source: Sareum corporate presentation, October 2024

…while limiting off-target toxicities related to other JAKs

A broad and non-selective inhibition of JAK enzymes, although effective, has been associated with off-target toxicities (particularly JAK2 and JAK3), highlighted by the black box warnings (increased risk of malignancy, thrombosis and cardiac events) associated with the previous generation JAK inhibitors Xeljanz, Olumiant and Rinvoq. SDC-1801 has been designed to selectively target the TYK2/JAK1 enzymes and its benign safety profile has been demonstrated in the early Phase I study. The advantages of selective targeting have also been showcased by the TYK2 inhibitor Sotyktu (deucravacitinib), which has a more than 100-fold TYK selectivity over JAK1/3 (due to binding to an allosteric site rather than the traditional adenosine triphosphate-binding site) and which received FDA approval in September 2022 for moderate-to-severe plaque psoriasis. Importantly, this approval was without the class-level black box warnings and without restricted usage (which would have limited the treatment to patients refractory to biologics and other available treatments). Sareum claims that the dual TYK2 and JAK1 inhibition offered by SDC-1801 could result in better efficacy (without safety trade-offs) in psoriasis and other autoimmune diseases compared to agents that target only one of the two kinases, although this would have to be proved in large clinical trials.

While SDC-1801 is designed to target a range of autoimmune diseases (such as rheumatoid arthritis, lupus and inflammatory bowel disease), Sareum is initially focusing on psoriasis, a serious dermatological condition affecting more than 125 million people globally (7.5–8.0 million in the US alone). The psoriasis market holds significant commercial potential, although it is highly competitive, with over 15 approved drugs. According to an article in Nature Reviews Drug Discovery, the psoriasis drug market was worth c US$34bn globally as of June 2023 and comprised c 30% of the total market for immunological disorders.

Competitive landscape

The psoriasis treatment market has long been dominated by biologics – TNF-α inhibitors, IL-12/23 inhibitors, IL-17 inhibitors and IL-23 inhibitors – which account for c 90% of the market share. The high selectivity of biologics (single targets) is associated with high efficacy rates, although the utility is challenged by a difficult drug administration (injectable or intravenous) and reduced efficacy over time. A sizeable proportion of patients eventually develop resistance to biologics, highlighting the need for other drug classes. The approval of Sotyktu marked the first JAK inhibitor to receive the regulatory nod in psoriasis, and its strong efficacy and safety profile has generated considerable interest from the market for this class of drugs. Several TYK2 programmes are currently under development across various clinical stages, although a majority of the development assets are pure-play TYK2 inhibitors and utilise an allosteric mechanism of action or bind to TYK2, versus the traditional adenosine triphosphate (ATP) approach used by Sareum for dual TYK2/JAK1 inhibition. Exhibit 5 presents an overview of selective TYK2 programmes under development.

Exhibit 5: TYK2 competitive landscape in autoimmune diseases

Company

Drug

Selectivity

Mechanism of action

Indications

Comments

Bristol Myers Squibb

Sotyktu (deucravacitinib)

TYK2

Allosteric TYK2 inhibition by binding to the pseudokinase domain of TYK2

Approved (US, EU and Japan) – PS
Phase III – PsA, SLE, SS
Phase II – DLE

The FDA approved Sotyktu for moderate-to-severe plaque psoriasis in September 2022 (without warnings as first-line treatment). The drug recorded sales of US$163m in 9M24. Phase III readouts in psoriatic arthritis are expected before year end 2024.

Priovant Therapeutics (Pfizer spin-out)

brepocitinib

TYK2/JAK1

Dual TYK2/JAK1 adenosine triphosphate (ATP) site

inhibitor

Phase III (oral) – dermatomyositis, NIU

The single registrational Phase III study (VALOR) evaluating brepocitinib in dermatomyositis patients initiated in Q222 and is now fully enrolled (n=241). Top-line results are expected in H225. Another Phase III trial (CLARITY) recently initiated in non-infectious uveitis following positive Phase II data.

Takeda/Nimbus Therapeutics

zasocitinib/

NDI-034858/
TAK-279

TYK2

Allosteric TYK2 inhibition by binding to the pseudokinase domain of TYK2

Phase III– PS

Phase II – PsA, UC, CD

Nimbus Therapeutics’ TYK2 programme was acquired by Takeda in December 2022 for an upfront payment of US$4bn. Takeda presented excellent data from the Phase IIb study in plaque psoriasis – one-third of patients receiving the highest dose of the drug achieved PASI100 (total skin clearance). A Phase III study is ongoing.

Alumis Therapeutics (former Esker Therapeutics)

ESK-001

TYK2

Allosteric TYK2 inhibition

Phase III – PS

Phase II – SLE

Positive data from the Phase II Stride trial (n=228, 12 weeks) evaluating ESK-001 for the treatment of plaque psoriasis was presented in March 2024. The first of three Phase III trials (ONWARD 3) initiated in July 2024. The company raised US$259m in series C funding in March 2024.

Hangzhou Highlightll Pharmaceutical

TLL-018

TYK2/JAK1

N/A

Phase II – RA, PS

The Phase II trial (n=120, 12 weeks) is underway in moderate-to-severe plaque psoriasis. An earlier Phase II study in rheumatoid arthritis demonstrated better response to twice-daily doses of TLL-018 compared to tofacitinib, an approved treatment for rheumatoid arthritis. Another TYK2/JAK1 inhibitor by the company (TLL-041) was acquired by Biohaven in March 2023 for US$20m in upfront cash and equity payment as well as up to US$950m in milestones. This will be developed for neurological disorders.

Galapagos

GLPG3667

TYK2

Selective adenosine triphosphate (ATP) TYK2 inhibitor

Phase II – DM, SLE

The Phase II study (GALACELA) in patients with active systemic lupus erythematosus initiated in August 2023 (n=140, 32-weeks). First patient was dosed in Phase II trial (GALARISSO) in dermatomyositis in May 2023 (n=62, 24 weeks).

Bristol Myers Squibb

Lomedeucitinib/

BMS-986322

TYK2

Allosteric TYK2 inhibition by binding to the pseudokinase domain of TYK2

Phase II – PS

A deuterated form of deucravacitinib. In August 2024, Bristol Myers Squibb completed a Phase II study to evaluate the effectiveness and safety of BMS-986322 in the treatment of moderate-to-severe psoriasis.

Innocare

ICP-332

TYK2

Allosteric TYK2 inhibition by binding to the pseudokinase domain of TYK2

Phase II – AD

ICP-332 achieved multiple efficacy endpoints in the Phase II study for the treatment of patients with moderate-to-severe atopic dermatitis (AD). Phase III trials in AD are expected to commence in China in 2024.

Innocare

ICP-488

TYK2

Allosteric TYK2 inhibition by binding to the pseudokinase domain of TYK2

Phase II– PS

In October 2024, the company announced positive results from the Phase II study in adult patients with moderate-to-severe plaque psoriasis. Following the 12-week treatment, 78.6% of patients at the higher dose achieved PASI75.

Accro Biosciences

AC-201

TYK2/JAK1

Allosteric TYK2/JAK1 inhibition by binding to the pseudokinase domain

Phase II – PS

In May 2024, the company dosed the first patient in the Phase II study in China, in subjects with moderate to severe plaque psoriasis.

Source: EvaluatePharma, Edison Investment Research. Note: PS = psoriasis; PsA = psoriatic arthritis; UC = ulcerative colitis; AD = atopic dermatitis; AA = alopecia areata; SLE = systemic lupus erythematosus; HS = hidradenitis suppurativa; MS = multiple sclerosis; SS = Sjögren’s Syndrome; DLE = Discoid Lupus Erythematosus; NIU = Non-infectious uveitis; DM = dermatomyositis; RA = rheumatoid arthritis; CHMP = Committee for Medicinal Products for Human Use; EMA = European Medicines Agency; PASI = Psoriasis Area and Severity Index; PASI75 denotes a 75% reduction from baseline in the PASI.

While Sotyktu’s FDA approval provides clear clinical validation to this class of drugs, recent deals/licensing agreements also point to sizeable commercial potential. The early 2023 acquisition of Nimbus Therapeutics’ Phase III-ready TYK2 programme, NDI-034858 (zasocitinib), by Takeda for US$6bn (US$4bn upfront and US$2bn related to sales milestones) set a strong benchmark for the market opportunity for this drug class. In March 2023, Biohaven acquired TLL Pharmaceuticals’ preclinical TYK2/JAK1 asset, TLL-041, for US$20m in an upfront payment and up to US$950m in milestones. While TLL-041 will be developed for neurological conditions and not autoimmune disorders, the deal highlights the significant potential for earlier-stage assets as well.

Given the strong clinical efficacy shown by Sotyktu and zasocitinib, we believe other programmes in development would have to demonstrate comparable or superior efficacy while maintaining strong safety signals. As noted previously, the majority of the assets under development are selective for TYK2 and use an allosteric approach for binding and inhibition. In contrast, SDC-1801 is a dual inhibitor of both TYK2 and JAK1 (management believes that inhibition of both could provide superior control of inflammation) and uses the ATP binding site approach to inhibition. As a result, we expect it to be positioned closer to Priovant Therapeutics’ (spun out of Pfizer and Roivant Sciences in June 2022; Pfizer holds a 25% stake in the venture) lead asset brepocitinib (due to its similar mechanism of action and TYK2/JAK1 selectivity), which is currently in Phase III development for dermatomyositis and non-infectious uveitis.

Sareum has compared Phase I data of SDC-1801 with that of brepocitinib, which suggests a potentially superior profile, although we maintain that early clinical data is not necessarily confirmatory for eventual drug performance. Sareum highlighted that cohort D of the MAD arm in the SDC-1801 Phase Ia study was able to achieve plasma exposure equivalent to 100mg per day dosage of brepocitinib, but without the side effect related to the dose (at the 100mg dose in its Phase I MAD study, brepocitinib caused increased serum creatinine (which tends to impact kidney function) and reduced neutrophil and reticulocyte levels (both progenitor of blood cell formation) after 10 days of dosing. Moreover, management noted that brepocitinib has a half-life of six to eight hours, significantly lower than the 17 to 20 hours for SDC-1801. Despite these differences, we believe that the upcoming Phase III results for brepocitinib in dermatomyositis in H225 may offer important read-across for SDC-1801.

Beyond SDC-1801: Activity expected to accelerate

Following the recent financing, Sareum has indicated that it will accelerate translational and pre-clinical development work on SDC-1802, it second TY2/JAK1 asset, which is being developed for oncology indications, an area where we note that the role of JAK inhibitors is not as well established. The company intends to work on translational studies to identify an optimal cancer indication and patient population before undertaking further toxicology and manufacturing studies. The drug holds a patent covering the molecular and pharmaceutical preparations of SDC1802 in the treatment of Tcell acute lymphoblastic leukaemia and other cancers (granted in April 2022). We look forward to further news on the preclinical progression of SDC-1802.

In addition to its two in-house assets, Sareum also holds a 27.5% economic stake in SRA737, an oral checkpoint kinase 1 (CHK1) inhibitor originally developed by the company in collaboration with Cancer Research UK-funded organisations. CRT Pioneer Fund holds the remaining majority stake in SRA737. Initially out-licensed to Sierra Oncology (which completed two Phase I/II trials for SRA737 and was subsequently acquired by GSK), the rights to the drug were returned to the original owners (Sareum and CRT Pioneer Fund) in November 2022. In December 2023, CRT Pioneer Fund out-licensed SRA737 to a privately held US biopharma for an upfront payment of US$0.5m, additional fees of up to US$1.0m in cash and 500,000 shares of the partner, and potential milestone payments of up to US$289m. The deal also allows for tiered high single-digit royalties on net sales. As part of the agreement, Sareum received US$137.5k as an upfront payment. The additional US$1m fees and 500,000 shares were payable earlier of either 12 months of signing of the licensing agreement or the licensee achieving a commercial or funding objective. This could mean that Sareum could potentially receive another US$275k plus 137,500 shares from the collaboration in early 2025. We note that given Sareum’s minority stake, the company has very limited control over any decision-making regarding the asset.

Financials

Increased clinical activity reflected in operating results

Sareum reported an operating loss of £4.6m in FY24 (12 months ended June 2024), up from £4.1m in FY23, attributable to a period of clinical activity for SDC-1801, which commenced the Phase I study in June 2023 (top-line readouts in June 2024). Reported net loss during the period was £3.4m (£3.2m in FY23), reflecting c £1m in R&D tax credits recognised during the year. Given the higher operating expenses during the period, net cash outflow from operating activities was reported at £3.9m, compared to £3.3m in FY23.

New funds extend runway into H2 CY25

As it is in the pre-revenue stage, Sareum continues to rely on external capital to support its development activities. At the end of FY24, the gross cash balance stood at £1.5m, versus £1.0m at end-FY23 and £0.4m at end-H124. The cash reserves were bolstered post period with the receipt of A$1.9m (c £1.0m) in R&D tax credits by the Australian authorities and a further £3.4m equity raise through a private placement in October 2024. The initial £2.4m in equity funds were raised against an issue of 11.8m new shares at a subscription price of 20p/share. The subsequent £1.0m was raised against a subscription of 4.4m shares at 22.5p/share. We note that each subscriber to the issue will also be entitled to one five-year warrant per share subscribed, exercisable at the subscription price. In case of a subsequent equity raise by the company at a lower issue price, the conversion price for the unexercised warrants will be re-based downwards to the exercise price of the new issue. With these new subscriptions, the company’s shares in issue increases to 124.7m.

Management estimates that along with cash at hand, the new funds raised as well as other expected receipts (likely to be additional R&D tax credits), the company will be funded into H2 CY25, covering further clinical development of SDC-1801 to Phase II (including longer-term toxicology studies) as well as accelerated preclinical work on SDC-1802.

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United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

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This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

London │ New York │ Frankfurt

20 Red Lion Street

London, WC1R 4PS

United Kingdom

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VinaCapital Vietnam Opportunity Fund’s (VOF’s) sterling net asset value (NAV) per share increased by 9.1% over the year ending October 2024 in total return (TR) terms, compared to the Vietnamese equity market’s 14.1%, as measured by the VN Index. Vietnam’s equities are benefiting from increased interest from local retail investors, driven by low deposit rates, alongside favourable economic prospects, including a revival of exports. In 2024, Vietnam’s GDP growth is expected to accelerate and corporate earnings on average to grow at double-digits (LSEG Data & Analytics consensus). VOF’s shares trade at a 25% discount to NAV (vs a five-year average of 18%) and offer a 2.5% dividend yield.

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