Valuation: Material upside potential to be unlocked
We value BIOV using a rNPV framework, reflecting the development stage and risk profile
of its two clinical programmes, BV100 and alpibectir. We use 12.5% as the discount
rate, the Edison standard for clinical stage companies.
BV100, the company’s lead asset targeting CRAB in HABP, VABP and BSI, is the dominant
value driver in our model. The programme is expected to commence patient recruitment
for Phase III from early 2026. Based on the addressable market size, incidence rates
and commercial assumptions, we estimate peak sales of c
US$700m across the US, Europe and China. We apply a 50% probability of success and assume
a 2028 launch, with pricing and treatment duration benchmarked against Fetroja (cefiderocol;
FDA approved in 2020) and Xacduro (sulbactam/durlobactam; FDA approved in 2023). Overall,
BV100 contributes around 75% of our total valuation. Note that our model currently
assumes self-commercialisation by BIOV in major markets, although we acknowledge that
regional partnerships, at least in the case of China, will be a more likely scenario
in some areas. However, given the challenges in estimating potential deal terms (which
can vary based on the trial data and deal timelines), we believe assuming self-commercialisation
in our model to be the more efficient approach for now. We will revisit our assumptions
with further progress for the programme.
BIOV’s second asset, alpibectir, represents a secondary value component for the company,
reflecting both clinical and commercial complexities in TB. Within this programme,
TB meningitis offers the more compelling opportunity, in our view, given the high
unmet need and mortality rates (c 50%). However, the addressable population remains
limited, estimated at 200,000–400,000 patients globally (2–4% of total TB cases),
and pricing is constrained by the predominance of emerging markets. Given the lack
of effective alternatives, we estimate BioVersys would be able to command the most
commercially attractive pricing terms for this cohort and model peak sales of
US$100m for TB meningitis, assuming a 30% probability of success. With the Phase IIb trial
planned to commence in Q126, we estimate Phase III to be initiated in 2028 with a
market launch in 2031.
In contrast, drug-resistant pulmonary TB represents a significantly larger population
(c two million patients globally), but is also characterised by greater competitive
intensity, notably from the established four-drug BPaLM regimen (bedaquiline, pretomanid,
linezolid and moxifloxacin) for drug-resistant TB. As a result, we assume lower achievable
market penetration (eg 20% in China, versus c 45% in TB meningitis), translating to
peak sales of
US$300m. Given the elevated development and commercial risk, we apply a 15% probability of
success and assume a 2032 launch. Treatment duration and pricing assumptions are benchmarked
to bedaquiline, a key component of the BPaLM regimen. After accounting for the 50/50
profit-sharing structure with GSK, alpibectir contributes CHF26.9m, or CHF4.6 per
share, to our valuation.
Our valuation also incorporates BIOV’s estimated end-FY25 net cash position of CHF63.4m,
including an estimated CHF78.0m in gross cash, partially offset by CHF14.6m of bank
debt (primarily related to the European Investment Bank, with maturities in H227 and
H229 and a further CHF7.5m tranche available for drawdown) and lease liabilities of
CHF0.2m.
Exhibit 1 presents a breakdown of our valuation of BIOV. Note that regulatory approval
in either TB meningitis or multi-drug resistant TB will allow BIOV to be eligible
for a priority review voucher (estimated at c
US$100m by management), which should add to further upside. Clinical progression of the pre-clincial
assets (BV200, BV500) also offers incremental opportunities for valuation uplift.
| Exhibit 1: BIOV risk-adjusted net present value |
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| Source: Edison Investment Research |
