Sequana Medical — On track to meet key milestones

Sequana Medical (BRU: SEQUA)

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Research: Healthcare

Sequana Medical — On track to meet key milestones

Sequana Medical has affirmed its guidance for its two lead programmes, the implantable alfapump device for recurrent and refractory ascites (RRA) and Direct Sodium Removal (DSR) 2.0 for diuretic-resistant congestive heart failure (CHF). Sequana is on track to submit a PMA application for the alfapump with the US FDA in Q423, which we believe could lead to US commercialisation in H224. Pre-launch activities are advancing and Sequana seems optimistic about the reimbursement path. It estimates the alfapump could be priced at $25k or more, with potential for higher payments via the NTAP designation. With the enrolment of the first patient in the non-randomised cohort of the MOJAVE Phase I/IIa DSR 2.0 study in July, the company continues to expect to report interim data on this cohort (n=3) by the end of 2023. It seeks to confirm the safety and efficacy shown with the first-generation product (DSR 1.0) and provide an early efficacy signal in US patients of DSR 2.0’s potential as a disease-modifying CHF treatment. After rolling forward our estimates and adjusting for forex, we obtain a pipeline rNPV valuation of €359.5m (€334.1m previously).

Written by

Pooya Hemami

Analyst - Healthcare

Healthcare

Sequana Medical

On track to meet key milestones

H123 update

Pharma and biotech

25 September 2023

Price

€3.14

Market cap

€89m

$1.07/€

Net cash (€m) at 30 June 2023, excluding leases

0.3

Shares in issue

28.2m

Free float

45%

Code

SEQUA

Primary exchange

Euronext

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

(14.2)

(1.5)

(41.6)

Rel (local)

(14.4)

(3.9)

(43.8)

52-week high/low

€7.4

€2.9

Business description

Based in Belgium, Sequana Medical develops products to treat diuretic-resistant fluid overload, a frequent complication of liver disease and heart failure. Its proprietary alfapump and DSR approaches aim to provide significant clinical and quality-of-life benefits in these fluid overload conditions.

Next events

Alfapump PMA submission to US FDA

Q423

Interim data from non-randomised cohort in MOJAVE Phase I/IIa DSR 2.0 study

Q423

Analysts

Pooya Hemami OD MBA CFA

+1 646 653 7026

Zoe Karamanoli

+44 20 3077 5700

Sequana Medical is a research client of Edison Investment Research Limited

Sequana Medical has affirmed its guidance for its two lead programmes, the implantable alfapump device for recurrent and refractory ascites (RRA) and Direct Sodium Removal (DSR) 2.0 for diuretic-resistant congestive heart failure (CHF). Sequana is on track to submit a PMA application for the alfapump with the US FDA in Q423, which we believe could lead to US commercialisation in H224. Pre-launch activities are advancing and Sequana seems optimistic about the reimbursement path. It estimates the alfapump could be priced at $25k or more, with potential for higher payments via the NTAP designation. With the enrolment of the first patient in the non-randomised cohort of the MOJAVE Phase I/IIa DSR 2.0 study in July, the company continues to expect to report interim data on this cohort (n=3) by the end of 2023. It seeks to confirm the safety and efficacy shown with the first-generation product (DSR 1.0) and provide an early efficacy signal in US patients of DSR 2.0’s potential as a disease-modifying CHF treatment. After rolling forward our estimates and adjusting for forex, we obtain a pipeline rNPV valuation of €359.5m (€334.1m previously).

Year
end

Revenue
(€m)

PBT*
(€m)

EPS*
(€)

DPS
(€)

P/E
(x)

Yield
(%)

12/21

0.4

(24.4)

(1.36)

0.0

N/A

N/A

12/22

0.9

(30.9)

(1.37)

0.0

N/A

N/A

12/23e

0.7

(31.8)

(1.14)

0.0

N/A

N/A

12/24e

1.8

(33.1)

(1.17)

0.0

N/A

N/A

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

Focus on US and Canadian alfapump launch

Following strong clinical data, where the alfapump showed statistically significant improvements in the need for therapeutic paracentesis (TP) procedures and in quality of life, the programme’s near-term focus is completion of the FDA PMA application by end-2023. Sequana plans to apply a targeted commercial approach with a direct sales force (n=50 initially) that will cover c 90 US adult liver transplant centres, which it estimates covers 95% of all transplant procedures in the US.

MOJAVE interim data expected by end-2023

DSR 2.0 is designed to provide an improved therapeutic and a more favourable safety profile compared to DSR 1.0, which showed in the SAHARA trial that it can resolve persistent congestion in diuretic-resistant CHF patients. Sequana expects to report initial data from the open-label cohort by end-2023.

Valuation: Mild upward revision

We have increased our R&D expense forecasts and our projected total funding need before H128 profitability (to €130m, €105m previously). After rolling forward our estimates and updating our forex assumptions, we now obtain an rNPV valuation of €359.5m (€334.1m previously). After adding €0.3m H123 net cash, we obtain an equity valuation of €359.8m or €12.76/share (€11.64 fully diluted given options outstanding) versus €12.22/share (€11.14 fully diluted) previously. We still expect the company’s cash on hand to maintain its operations into Q124, and we project €35m (€30m previously) in new financing before end-FY24.

Approaching key alfapump and DSR milestones

Sequana reiterated in its H123 results that it continues to expect to submit a US Premarket Approval (PMA) application for the alfapump in RRA in Q423, which we estimate could lead to US market launch in H224. As explained in a recent note, Sequana Medical initially reported positive results in Q422 from the POSEIDON North American pivotal study of its implantable alfapump device in patients with RRA due to liver cirrhosis. The alfapump met its objective in significantly reducing the need for TP procedures in recruited RRA patients, whom on average required 3.2 TP procedures per month prior to implantation. The near elimination of the need for TP is very meaningful, given that ascites episodes themselves and TP procedures place a significant burden on patients’ quality of life (QoL). The company reported that reduction in the need for TP in POSEIDON (and the implied reduced ascites burden) led to clinically relevant and statistically significant QoL improvements (n=26, p<0.001) in both the physical component score of the SF-36 scale and the Ascites-Q scores. Patients in the pivotal cohort (n=40) also showed a 70% one-year survival rate, which compares favourably to literature citing a c 50% one-year survival rate for refractory ascites patients.

Altogether the POSEIDON results demonstrate that the alfapump is very effective at controlling RRA, virtually eliminating the need for large volumes of TP procedures and significantly improving patients’ QoL at life at six months post-implantation. This, combined with favourable safety and encouraging survival data, bodes well for the product’s potential US approval, in our view.

US alfapump pricing of at least $25k expected

Our forecasts assume alfapump’s net unit price at US launch would be $25,000 (comparable to the current selling price in Europe). When assessing net reimbursement for alfapump in the US, two key elements should be considered: coverage and coding. The role of Medicare is critical given that we estimate the majority of potential alfapump patients will be over 65 years of age and thus potentially covered by Medicare. We see existing and new initiatives by the US Centers for Medicare & Medicaid Services (CMS), as providing favourable conditions for reimbursement levels consistent with (and potentially even above) our expectations and for quick reimbursement decision timelines upon US approval .

Diagnosis Related Group (DRG) codes are used for reimbursement of hospital in-patient procedures and they determine a fixed Medicare payment that covers all hospital-related costs, including physician fees, room and board, and all drugs and medical devices that may be used. The alfapump is intended to be used in a hospital in-patient procedure and there are existing DRG codes that can be used for the alfapump. The alfapump’s reimbursement will be part of this overall DRG code payment.

Existing DRG codes suggest that a price of at least $25k for the alfapump is achievable. DRG codes reflect the primary ICD-10 diagnosis code (ICD-10-CM), ICD-10 procedure code (ICD-10-PCS) and the severity of the patient's condition during their stay. Based on the current ICD-10 codes that can be used for the alfapump, the company believes that the likely DRG code for alfapump implantation would be 423 ‘Other Hepatobiliary or Pancreas O.R. Procedures’, which is expected to result in an average DRG payment of $60–70k in 2025. Assuming this reimbursement amount for the overall implantation procedure supports our assumption of $25,000 net pricing for the alfapump device itself. In addition, the new technology add-on payment (NTAP) process adds further support to the prospect of elevated alfapump pricing, and may even lead to net US revenues per alfapump coming in above our estimates. Certain qualifying products may be eligible for a payment above the standard DRG code through the NTAP designation, generally for up to three years after the introduction of the new technology. After these three years, the prospective DRG rates can be recalibrated to reflect the utilisation of the new technology. Eligibility is based on three criteria: newness, cost and substantial clinical improvement (ie the technology must represent an advance that substantially improves, relative to technologies previously available, the diagnosis or treatment of Medicare beneficiaries). The alfapump would meet the newness and substantial clinical improvement criteria given that it has already received Breakthrough Device designation by the FDA. If an alfapump NTAP application to the CMS is accepted by the agency, we see the potential for alfapump to achieve an even higher price than our base case of $25,000.

TCET could accelerate Medicare alfapump reimbursement

The CMS in June 2023 announced that it was seeking public comment on a newly proposed Medicare coverage pathway termed transitional coverage for emerging technologies (TCET), which aims to provide more timely access for Medicare-insured patients to emerging technologies as product sponsors gather additional evidence to support longer-term Medicare reimbursement. Products that would receive coverage under the TCET pathway would automatically be provided with between three and five years of Medicare coverage upon regulatory approval. The TCET pathway is intended to be a voluntary process for product sponsors and is designed to facilitate immediate and predictable reimbursement coverage for promising technologies shortly upon FDA approval or clearance, and it sets parameters to permit the participating sponsors to gather additional evidence (on potential benefits of the technologies) and to support longer-term ongoing reimbursement. Products potentially eligible for the TCET pathway must fit defined criteria, including having FDA-designated Breakthrough Device status, falling within an existing Medicare benefit category, but not already being subject to an existing Medicare national coverage determination (NCD) category. The alfapump fits all of these criteria, and hence if the proposed TCET pathway is formalised and officially adopted, we anticipate that Sequana would seek to nominate itself to participate in the TCET pathway. We note that under the proposed guidelines, the CMS anticipates only accepting up to five TCET candidates per year due to resource limitations. Hence, while TCET may provide a promising pathway for accelerated national coverage by CMS/Medicare, it is not yet certain if alfapump would necessarily receive such expedited automatic coverage at launch.

MOJAVE interim readout still expected by year-end 2023

Sequana remains on track to report interim data from the non-randomised cohort (n=3) of its MOJAVE Phase I/IIa study assessing the safety and efficacy of its second-generation DSR 2.0 programme in diuretic-resistant CHF patients across two cohorts. The company announced the enrolment of the first patient in the non-randomised cohort in July 2023, and it expects to report initial data from the three-patient, open-label cohort by year-end 2023, which may demonstrate proof-of-concept and provide an early efficacy signal of DSR 2.0’s potential as a disease-modifying CHF treatment.

Exhibit 1: Design of MOJAVE Phase I/IIa study

Source: Sequana Medical H123 presentation

As a reminder, DSR 2.0 is designed to provide an improved therapeutic and a more favourable safety profile compared to the first-generation product (DSR 1.0), which showed in the SAHARA trial that it can resolve persistent congestion in diuretic-resistant CHF patients. More importantly, all evaluable patients improved their New York Heart Association status by at least one class (in a four-class scale) and experienced no congestion-related hospital readmissions during the study. These findings, combined with a 33% mean reduction in NT-proBNP (a marker of cardiac function) and a stable eGFR (a marker of kidney function), both at 16 weeks post the intensive DSR therapy period versus baseline, suggest DSR’s potential as a disease-modifying CHF therapy, in our view.

Exhibit 2: MOJAVE study timelines

Source: Sequana Medical H123 presentation

In the open-label MOJAVE cohort, three patients will receive DSR 2.0 via a peritoneal dialysis (PD) catheter on top of optimised usual care for up to four weeks. An independent data safety monitoring board will then determine whether the study can proceed to the randomised cohort. This cohort is designed to enrol 30 patients, with 20 patients randomised to DSR 2.0 administered via a PD catheter on top of optimised usual care for CHF for up to four weeks, and 10 patients randomised to intravenous loop diuretic treatment as part of maximised usual care for CHF. Both cohorts will have a three-month safety follow-up period after the four weeks of DSR therapy.

The company expects to report top-line data from the randomised cohort in 2025, and interim data from this cohort in H224. Nonetheless, initial data from the open-label cohort, expected in Q423, could provide an early indicator of DSR 2.0’s potential efficacy in reducing congestion and demonstrating disease-modifying properties, given the very significant effects already shown for DSR 1.0 in the SAHARA and RED DESERT studies.

Hence, the non-randomised cohort of MOJAVE may provide a strong efficacy signal and provide a meaningful clinical validation of the DSR 2.0 product and its method of administration (through a PD catheter), which may provide the opportunity for a re-rating of the shares ahead of the company’s next fund-raising need.

Financials and valuation

Sequana reported an H123 operating loss of €15.4m, above our estimate of €12.2m. The primary driver for the higher than expected loss was H123 R&D expenses at €11.7m, which was above our €8.0m estimate, mainly due to the quality and regulatory, supply chain and engineering costs, which are largely associated with the alfapump programme. The operating cash burn rate was €16.4m, higher than our €13.5m estimate.

We have increased our H223 and FY24 R&D cost estimates to reflect recent trends, and as a result we now expect higher operating losses in FY23 (€30.4m) and FY24 (€30.3m) than previously (€25.2m and €25.6m, respectively). We have also slightly increased some of our longer-term R&D cost assumptions for the DSR programme. The result of these changes is that we now anticipate that the company will require €130m in additional financing through the end of FY27 prior to reaching operating profitability (which we continue to anticipate in H128), versus €105m previously, and including €35m (vs €30m previously) before the end of FY24. As per our usual policy, we model all future fund-raising requirements as illustrative debt. We continue to assume that the company’s gross cash on hand (€17.1m at 30 June) will be sufficient for it to maintain operations into Q124.

We have rolled forward our model and adjusted our forex estimates to reflect a $1.07/€ assumption (vs $1.10/€ previously), with both adjustments having an upward effect on our valuation. Following these changes, we now obtain an rNPV valuation of €359.5m versus €334.1m previously. After adding €0.3m H123 net cash (€17.1m gross cash offset by €16.8m in total debt, excluding €0.85m in lease liabilities), we obtain an equity valuation of €359.8m or €12.76/share (€11.64 fully diluted given options outstanding), versus €12.22/share (€11.14 fully diluted) previously.

Exhibit 3: Sequana Medical rNPV assumptions

Product

Indication

Stage

NPV
(€m)

Probability of success

rNPV
(€m)

rNPV/ basic share (€)

Launch year

Sales in 2032 (€m)

alfapump in North America (net of R&D and SG&A costs)

Refractory and recurrent ascites and malignant ascites

Pivotal studying ongoing

275.4

80%

220.3

7.81

H224

195.2

alfapump in Europe and ex-NA regions (net of SG&A costs)

Refractory and recurrent ascites and malignant ascites

Commercial/ marketed

(1.5)

100%

(1.5)

(0.05)

2013

1.0

DSR 2.0 (Short-term DSR)

Fluid overload in heart failure

Human feasibility studies

852.2

25%

201.1

7.13

2028

356.9*

Corporate costs

(60.4)

100%

(60.4)

(2.14)

Total

1,065.6

359.5

12.75

Net cash (30 June 2023) excluding lease liabilities

0.3

0.3

0.01

Total equity value

1,066.0

359.8

12.76

Basic shares outstanding (000)

28,192

Outstanding warrants and share options (000)

2,722

Fully diluted shares outstanding (000)

30,914

Source: Edison Investment Research. Note: *Reflects estimate of projected royalty revenue to Sequana Medical rather than end-market commercial sales.

As a sensitivity, our equity valuation per basic share would be adjusted to €7.30/share if we assume that total future funding need (€130m) is met through equity issuances at the current share price (c €3.2/share).

Exhibit 4: Financial summary

€000s

2018

2019

2020

2021

2022

2023e

2024e

Year end 31 December

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

IFRS

PROFIT & LOSS

Revenue

 

 

1,029

971

963

371

923

707

1,767

Cost of Sales

(158)

(198)

(202)

(77)

(205)

(153)

(353)

Gross Profit

871

773

761

294

718

554

1,414

General & Administrative

(8,206)

(7,102)

(6,738)

(7,177)

(8,927)

(9,822)

(14,480)

Net Research & Development

(5,816)

(7,652)

(11,835)

(16,935)

(20,416)

(21,157)

(17,250)

Operating profit before exceptionals

(13,150)

(13,981)

(17,813)

(23,818)

(28,625)

(30,426)

(30,317)

EBITDA

 

 

(13,070)

(13,737)

(17,506)

(23,409)

(28,313)

(29,889)

(29,662)

Depreciation & other

(81)

(244)

(307)

(409)

(312)

(537)

(654)

Operating Profit (before amort. and except.)

 

(13,150)

(13,981)

(17,813)

(23,818)

(28,625)

(30,426)

(30,317)

Exceptionals including asset impairment

74

18

41

1,205

530

0

0

Operating Profit

(13,077)

(13,964)

(17,771)

(22,613)

(28,095)

(30,426)

(30,317)

Net Interest

(883)

(878)

(1,178)

(608)

(2,282)

(1,377)

(2,738)

Profit Before Tax (norm)

 

 

(14,033)

(14,859)

(18,991)

(24,426)

(30,907)

(31,803)

(33,054)

Profit Before Tax (FRS 3)

 

 

(13,960)

(14,841)

(18,949)

(23,221)

(30,377)

(31,803)

(33,054)

Tax

(24)

(136)

(157)

(393)

(387)

(255)

0

Profit After Tax and minority interests (norm)

(14,057)

(14,995)

(19,148)

(24,819)

(31,294)

(32,059)

(33,054)

Profit After Tax and minority interests (FRS 3)

(13,983)

(14,977)

(19,106)

(23,614)

(30,764)

(32,059)

(33,054)

Average Number of Shares Outstanding (m)

10.0

12.3

15.3

18.2

22.8

28.2

28.2

EPS - normalised (€)

 

 

(1.41)

(1.22)

(1.25)

(1.36)

(1.37)

(1.14)

(1.17)

EPS - normalised and fully diluted (€)

 

 

(1.41)

(1.22)

(1.25)

(1.36)

(1.37)

(1.14)

(1.17)

EPS - (IFRS) (€)

 

 

(1.40)

(1.22)

(1.25)

(1.30)

(1.35)

(1.14)

(1.17)

Dividend per share (€)

0.0

0.0

0.0

0.0

0.0

0.0

0.0

BALANCE SHEET

Fixed Assets

 

 

242

829

772

1,814

2,936

2,963

2,731

Tangible Assets

184

765

705

1,732

2,850

2,875

2,644

Investments in long-term financial assets

58

63

67

82

86

88

88

Current Assets

 

 

3,099

8,522

13,441

12,890

23,089

1,938

4,478

Short-term investments

0

0

0

0

0

0

0

Cash

1,318

5,586

11,016

9,600

18,875

1,651

3,605

Other

1,782

2,935

2,425

3,290

4,214

287

873

Current Liabilities

 

 

(18,727)

(5,315)

(5,966)

(7,180)

(15,149)

(9,051)

(9,221)

Creditors

(6,654)

(4,855)

(5,966)

(7,180)

(10,666)

(6,169)

(6,339)

Short term borrowings

(12,073)

(459)

0

0

(4,483)

(2,882)

(2,882)

Long Term Liabilities

 

 

(3,374)

(3,110)

(8,135)

(8,312)

(13,030)

(14,867)

(49,867)

Long term borrowings

(2,582)

(2,261)

(7,473)

(7,325)

(12,193)

(13,909)

(48,909)

Other long term liabilities

(792)

(849)

(662)

(987)

(837)

(958)

(958)

Net Assets

 

 

(18,760)

926

113

(788)

(2,154)

(19,017)

(51,878)

CASH FLOW

Operating Cash Flow

 

 

(8,987)

(17,596)

(15,791)

(22,786)

(24,822)

(30,326)

(29,887)

Net interest and financing income (expense)

(883)

(878)

(1,178)

(608)

(2,282)

(1,377)

(2,738)

Tax

(5)

(9)

(36)

(222)

(378)

0

0

Net Operating Cash Flow

 

 

(9,875)

(18,482)

(17,005)

(23,616)

(27,482)

(31,704)

(32,624)

Capex

(39)

(106)

(138)

(326)

(677)

(210)

(423)

Acquisitions/disposals

0

0

0

0

0

0

0

Financing (net of costs)

2

26,165

19,000

22,771

28,420

15,780

0

Dividends

0

0

0

0

0

0

0

Other

0

0

0

0

0

0

0

Net Cash Flow

(9,912)

7,576

1,857

(1,171)

261

(16,133)

(33,047)

Opening net debt/(cash)

 

 

0

13,337

(2,866)

(3,543)

(2,275)

(2,199)

15,140

HP finance leases initiated

0

0

0

0

0

0

0

Other

(3,425)

8,627

(1,179)

(97)

(337)

(1,206)

0

Closing net debt/(cash)

 

 

13,337

(2,866)

(3,543)

(2,275)

(2,199)

15,140

48,186

Lease debt

na

504

387

760

916

853

853

Closing net debt/(cash) inclusive of IFRS16 lease debt

13,337

(2,362)

(3,157)

(1,515)

(1,283)

15,992

49,039

Source: Company reports, Edison Investment Research


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The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

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United Kingdom

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Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

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

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

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

United States

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

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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