Basilea Pharmaceutica — Zevtera crosses key US regulatory hurdle

Basilea Pharmaceutica (SIX: BSLN)

Last close As at 22/05/2024

CHF43.10

−0.55 (−1.26%)

Market capitalisation

CHF584m

More on this equity

Research: Healthcare

Basilea Pharmaceutica — Zevtera crosses key US regulatory hurdle

Basilea has announced the FDA approval of its second lead asset, Zevtera (ceftobiprole), for the treatment of severe bacterial infections (three indications), marking a major commercial win. The US is the most commercially lucrative market for Zevtera, accounting for 85–90% of its total market potential. Zevtera is already approved in several countries (including in Europe) and the FDA nod is based on three Phase III studies (including the ERADICATE and TARGET studies with R&D partly funded by the BARDA). Note that the drug holds the Qualified Infectious Disease Product (QIDP) designation, which will provide up to 10-years of market exclusivity following approval. As we await more details on the US commercial partner (expected by mid-2024), we upgrade our US probability of success (PoS) to 100%, bumping our valuation to CHF1,008.6m or CHF84.0/share (from CHF80.7/share).

Soo Romanoff

Written by

Soo Romanoff

Managing Director - Head of Content, Healthcare

Healthcare

Basilea Pharmaceutica

Zevtera crosses key US regulatory hurdle

Regulatory update

Pharma and biotech

4 April 2024

Price

CHF37.25

Market cap

CHF488m

CHF0.9/US$

Net debt (CHFm) at 31 December 2023

46.6

Shares in issue (excluding 1.12m treasury shares)

12.0m

Free float

90%

Code

BSLN

Primary exchange

SIX

Secondary exchange

N/A

Share price performance

%

1m

3m

12m

Abs

9.2

10.7

(22.3)

Rel (local)

8.1

6.4

(25.8)

52-week high/low

CHF48.65

CHF32.25

Business description

Basilea Pharmaceutica is focused on treating infectious diseases. Its marketed products are Cresemba (an antifungal) and Zevtera (an anti-MRSA broad-spectrum antibiotic). In late 2023, the company expanded its pipeline to include antifungal BAL2062, antibiotic tonabacase (evaluation licence) and Phase III-ready, novel broad-spectrum antifungal treatment fosmanogepix (two Phase III trials planned for initiation in 2024).

Next events

Decision on EU paediatric extension

H124

Fosmanogepix Phase III initiation

Mid-24

Announcement of US partner for Zevtera

Mid-24

Analysts

Soo Romanoff

+44 (0)20 3077 5700

Jyoti Prakash, CFA

+44 (0)20 3077 5700

Basilea Pharmaceutica is a research client of Edison Investment Research Limited

Basilea has announced the FDA approval of its second lead asset, Zevtera (ceftobiprole), for the treatment of severe bacterial infections (three indications), marking a major commercial win. The US is the most commercially lucrative market for Zevtera, accounting for 85–90% of its total market potential. Zevtera is already approved in several countries (including in Europe) and the FDA nod is based on three Phase III studies (including the ERADICATE and TARGET studies with R&D partly funded by the BARDA). Note that the drug holds the Qualified Infectious Disease Product (QIDP) designation, which will provide up to 10-years of market exclusivity following approval. As we await more details on the US commercial partner (expected by mid-2024), we upgrade our US probability of success (PoS) to 100%, bumping our valuation to CHF1,008.6m or CHF84.0/share (from CHF80.7/share).

Year end

Revenue
(CHFm)

PBT*
(CHFm)

EPS*
(CHFc)

DPS
(CHFc)

P/E
(x)

Yield
(%)

12/22

147.8

12.3

104.1

0.0

35.8

N/A

12/23

157.6

10.8

89.7

0.0

41.5

N/A

12/24e

187.2

28.0

233.6

0.0

15.9

N/A

12/25e

209.1

32.3

269.2

0.0

13.8

N/A

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

A broad-spectrum anti-MRSA agent

Zevtera is a fifth-generation cephalosporin anti-infective, with broad spectrum activity against both drug-resistant, gram-positive and gram-negative bacterial infections. The drug is currently approved and marketed in 21 countries (including major European and international markets, through distribution partners) for bacterial lung infections (pneumonia) and has been particularly effective against methicillin-resistant Staphylococcus aureus (MRSA), a leading cause of hospital acquired infections. The US is the biggest MRSA market and therefore the largest commercial opportunity for the company. The global MRSA treatment market was estimated to be worth $3.8bn in 2021, with the US accounting for c 85%.

Zevtera’s path to approval

The FDA has approved Zevtera for the treatment of Staphylococcus aureus bacteremia (SAB), acute bacterial skin and skin structure infections (ABSSSI) and community-acquired bacterial pneumonia (CABP). This was based on data from three Phase III trials, including TARGET (ABSSSI) and ERADICATE (SAB), designed under special protocol assessment (SPA). Both trials met their primary efficacy endpoints, leading to the NDA filing in August 2023. In line with Basilea’s business model, we expect commercialisation to be undertaken by a licensing partner, with Basilea receiving upfront, milestone and royalty payments.

Valuation: Increases to CHF1,008.6m CHF84/share

Given the positive topline data from the Phase III trials, we were already ascribing a high PoS (90%) to Zevtera in the US and now have increased it to 100% following the US approval. We continue to estimate peak sales of >$500m for the drug. Our other assumptions remain unchanged. Our valuation increases to CHF1,008.6m or CHF84.0/share (from CHF968.0m or CHF80.7/share previously).

Zevtera reaches its US destination

Zevtera is a new-generation cephalosporin, which is administered intravenously, and has shown activity against clinically important gram-positive bacteria, such as Staphylococcus aureus (including methicillin-resistant strains, MRSA), and gram-negative bacteria. The drug has already been approved in major countries across Europe, Latin America, the Middle East, North Africa and Canada (marketed as either Zevtera or Mabelio) and is currently marketed in a total of 21 countries for hospital and community acquired bacterial pneumonia (HABP, CABP).

The FDA approval has been granted for the treatment of adult patients with SAB (including those with right-sided infective endocarditis caused by MRSA and methicillin-susceptible Staphylococcus aureus; MSSA), adult patients with ABSSSI and for adult and paediatric patients (three months to less than 18 years old) with CABP. As previously communicated by management, we expect the initial focus for the company to be on the treatment of SAB, which afflicts c 120,000 people in the US per year and has a three-month mortality rate of 25%. The treatment landscape for SAB remains underserved with only two treatments currently approved to cover both MRSA and MSSA (vancomycin and daptomycin). Zevtera’s approval marks the first approval for the treatment in SAB in the last 15 years. While management had communicated its intentions to finalise a commercial partner in the US before the regulatory decision, this now has been pushed out to mid-2024. We understand this may be due to several competing interests and offers for Zevtera licensing and look forward to an update on this from the company.

We view the FDA approval as a key milestone for the company’s commercialisation efforts, given that the region represents the largest potential market for Zevtera (c 85%, according to IQVIA, December 2023). For reference, Exhibit 1 highlights the US market share of other anti-MRSA drugs, daptomycin (brand name Cubicin) and ceftaroline (brand name Teflaro). The MRSA treatment market was valued at $3.8bn in 2021 and is projected to reach $5.5bn by 2030.

Exhibit 1: The US represents the most important region for the anti-MRSA treatment market

Source: Basilea corporate presentation, April 2024. Notes: LOE, loss of exclusivity; ROW, rest of world; MAT, moving annual total. Both daptomycin and ceftaroline are FDA approved anti-MRSA antibiotic therapies.

Completing a long clinical pathway

Zevtera’s FDA approval is based on positive clinical efficacy and safety data from three separate Phase III studies:

ERADICATE (for SAB) – a double-blind, randomised trial investigating the treatment of adult SAB patients (including those with infective endocarditis, IE). The study enrolled 390 patients with SAB caused by MRSA or methicillin-susceptible Staphylococcus aureus (MRSS), who were randomised into either the active arm (ceftobiprole iv infusion) or the comparator arm (daptomycin with or without aztreonam for gram-negative infections). The primary endpoint was the demonstration of non-inferiority (15% non-inferiority margin) versus the comparator arm in the modified intent-to-treat population (Exhibit 2).

Exhibit 2: The ERADICATE study met both primary and secondary endpoints

Source: Basilea corporate presentation, April 2024. Note: PTE - Post-treatment evaluation visit at 70 days post-randomisation.

Exhibit 2: The ERADICATE study met both primary and secondary endpoints

Source: Basilea corporate presentation, April 2024. Note: PTE - Post-treatment evaluation visit at 70 days post-randomisation.

Topline data (released in June 2022) demonstrated an overall success rate of 69.8% in the ceftobiprole arm versus 68.7% in the daptomycin (±aztreonam) arm, indicating non-inferiority. In addition, Basilea reported that initial subgroup analysis showed no significant differences between the two treatment groups.

TARGET (for ABSSSI) – in August 2019, Basilea reported positive topline results for the Phase III TARGET study, a 679 patient, randomised, double-blind, active-controlled study evaluating ceftobiprole in the treatment of patients with ABSSSI. The drug met the primary efficacy objective of non-inferiority (within the pre-specified margin of 10%) to vancomycin plus aztreonam in the intent-to-treat (ITT) population. The primary endpoint (early clinical response) was based on a 20% or more reduction from baseline in lesion size at 48 to 72 hours after start of study drug administration (Exhibit 3).

Exhibit 3: Early clinical response at48-72h after start of treatment (ITT population)

Exhibit 4: Investigator-assessed clinical outcomes 15-22 days after randomisation

Source: Basilea corporate presentation, April 2024.

Source: Basilea corporate presentation, April 2024.

Exhibit 3: Early clinical response at48-72h after start of treatment (ITT population)

Source: Basilea corporate presentation, April 2024.

Exhibit 4: Investigator-assessed clinical outcomes 15-22 days after randomisation

Source: Basilea corporate presentation, April 2024.

A Phase III trial (for CABP) – a Phase III randomised, double-blind study comparing ceftobiprole to ceftriaxone, with or without linezolid, in 638 patients with CABP. The trial met its primary endpoint (clinical cure rates at the test-of-cure visit 7-14 days after the end of treatment). Of the patients who received ceftobiprole, 76.4% achieved clinical cure compared with 79.3% of those who received the comparator, demonstrating noninferiority of ceftobiprole to ceftriaxone with or without linezolid.

The Phase III programme for Zevtera was majority funded by the Biomedical Advanced Research and Development Authority (BARDA), whereby it provided c $112m to fund the SAB and ABSSSI clinical studies (c 75% of the costs), alongside related regulatory activities and non-clinical work. Based on the positive results from the Phase III studies, Basilea submitted the new drug application (NDA) for Zevtera in August 2023, which was accepted by the FDA in October 2023.

As previously highlighted the FDA has granted the QIDP designation to ceftobiprole, which will provide 10 years of market exclusivity in the US. We expect the company to seek a partnership for commercialisation in the US and await an update from management on this.

Valuation

Following the FDA approval for Zevtera, we increase the PoS from 90% to 100% in the US, while keeping all other underlying assumptions unchanged. We continue to estimate peak sales of >$500m for Zevtera worldwide. Our overall valuation for Basilea adjusts to CHF1,008.6m or CHF84.0/share (CHF968.0m or CHF80.7/share previously). This also includes some benefit from updated forex rates.

Exhibit 5: Basilea Pharmaceutica valuation

Product

Indication

Launch

Peak sales
($m)

NPV
(CHFm)

Probability

rNPV
(CHFm)

rNPV/share (CHF)

Cresemba (isavuconazole)

Severe fungal infections

2015 (US); 2016 (EU); 2018 (RoW); 2022 (China): 2023 (Japan)

686

608.9

100%

608.9

50.7

Zevtera/Mabelio (ceftobiprole)

Severe bacterial infections

2015 (EU); 2018 (RoW); 2024 (US)

581

328.5

100%

328.5

27.4

Fosmanogepix

Severe fungal infections

2029 (US, EU and Japan), 2030 (RoW)

802

241.9

60%

117.9

9.8

Net cash/(debt) at end December 2023

 

 

(46.6)

100%

(46.6)

(3.9)

Valuation

 

 

 

1,132.7

 

1,008.6

84.0

Source: Edison Investment Research

Exhibit 6: Financial summary

Accounts: US GAAP, year end 31 December, CHF:000s

 

 

2021

2022

2023

2024e

2025e

PROFIT & LOSS

 

 

 

 

 

 

 

Total revenues

 

 

148,122

147,765

157,634

187,212

209,058

Product revenues (Cresemba and Zevtera)

 

 

131,382

122,315

150,275

183,912

205,758

Cost of sales

 

 

(24,072)

(24,603)

(26,794)

(33,875)

(41,251)

Gross profit

 

 

124,050

123,162

130,840

153,337

167,807

Research and development expenses (net)

 

 

(93,157)

(73,804)

(77,852)

(84,924)

(92,343)

SG&A costs

 

 

(29,721)

(30,815)

(33,783)

(35,665)

(38,859)

Exceptionals and adjustments

 

 

15

0

0

0

0

EBITDA (reported)

 

 

1,941

19,640

20,782

33,954

37,889

Reported operating income

 

 

1,187

18,543

19,205

32,747

36,605

Operating margin %

 

 

N/A

N/A

N/A

N/A

N/A

Finance income/(expense)

 

 

(7,982)

(6,441)

(8,744)

(5,021)

(4,622)

Profit before tax (reported)

 

 

(6,795)

12,102

10,461

27,727

31,983

Profit before tax (normalised)

 

 

(6,610)

12,302

10,761

28,018

32,286

Income tax expense (includes exceptionals)

 

 

(37)

45

(10)

0

0

Net income (reported)

 

 

(6,832)

12,147

10,451

27,727

31,983

Net income (normalised)

 

 

(6,647)

12,347

10,751

28,018

32,286

Basic average number of shares, m

 

 

11.68

11.86

11.99

11.99

11.99

Basic EPS (CHF c)

 

 

(58.5)

102.4

87.2

231.2

266.7

Adjusted EPS (CHF c)

 

 

(56.9)

104.1

89.7

233.6

269.2

Dividend per share (CHF c)

 

 

0

0

0

0

0

BALANCE SHEET

 

 

 

 

 

 

 

Restricted cash

 

 

0

22,000

0

0

0

Tangible assets

 

 

2,018

4,277

3,757

3,942

4,061

Intangible assets

 

 

632

578

548

457

354

Long-term investments

 

 

2,390

1,266

0

0

0

Other non-current assets

 

 

1,161

17,363

16,839

16,839

16,839

Total non-current assets

 

 

6,201

45,484

21,144

21,238

21,254

Cash and equivalents

 

 

53,700

84,659

59,933

66,207

93,411

Restricted cash

 

 

1,253

1,908

4,389

4,389

4,389

Short-term investments

 

 

95,000

0

0

0

0

Inventories

 

 

22,783

24,244

26,410

33,389

40,659

Trade and other receivables

 

 

24,947

33,152

27,891

33,124

36,990

Other current assets

 

 

43,383

31,401

33,522

33,522

33,522

Total current assets

 

 

241,066

175,364

152,145

170,632

208,971

Convertible senior unsecured bonds (long-term)

 

 

94,544

95,000

95,455

95,455

95,455

Senior secured loan

 

 

0

36,360

0

0

0

Deferred revenue

 

 

11,926

10,693

9,460

9,460

9,460

Non-current operating lease liabilities

 

 

10

16,323

15,636

15,636

15,636

Other non-current liabilities

 

 

24,986

8,337

15,149

15,149

15,149

Total non-current liabilities

 

 

131,466

166,713

135,700

135,700

135,700

Convertible senior unsecured bonds (short-term)

 

 

123,505

0

0

0

0

Senior secured loan

 

 

0

37,467

15,453

0

0

Accounts payable

 

 

10,617

191

5,847

7,392

9,002

Deferred revenue

 

 

1,233

1,233

1,233

1,233

1,233

Current operating lease liabilities

 

 

896

1,988

2,062

2,062

2,062

Other current liabilities

 

 

38,157

33,971

22,997

22,997

22,997

Total current liabilities

 

 

174,408

74,850

47,592

33,684

35,294

Net assets

 

 

(58,607)

(20,715)

(10,003)

22,486

59,231

CASH FLOW STATEMENT

 

 

 

 

 

 

 

Reported net income

 

 

(6,831)

12,147

10,451

27,727

31,983

Depreciation and amortisation

 

 

754

1,097

1,577

1,206

1,284

Share based payments

 

 

4,322

3,598

4,762

4,762

4,762

Other adjustments

 

 

1,522

497

1,443

0

0

Movements in working capital

 

 

(31,787)

(10,282)

(3,988)

(10,667)

(9,526)

Cash from operations (CFO)

 

 

(32,020)

7,057

14,245

23,027

28,503

Capex

 

 

(581)

(3,138)

(813)

(1,100)

(1,100)

Short-term investments

 

 

6,023

94,951

0

0

0

Long-term investments

 

 

0

0

0

0

0

Other investing activities

 

 

(1,867)

(165)

(221)

(200)

(200)

Cash used in investing activities (CFIA)

 

 

3,575

91,648

(1,034)

(1,300)

(1,300)

Net proceeds from issue of shares

 

 

42,240

250

(381)

0

0

Movements in debt

 

 

(23,212)

(49,672)

(59,314)

(15,453)

0

Other financing activities

 

 

(2,388)

4,176

2,390

0

0

Cash from financing activities (CFF)

 

 

16,640

(45,246)

(57,305)

(15,453)

0

Cash and equivalents at beginning of period

 

 

66,256

54,952

108,566

64,321

70,596

Increase/(decrease) in cash and equivalents

 

 

(11,805)

53,459

(44,094)

6,274

27,203

Effect of FX on cash and equivalents

 

 

501

155

(151)

0

0

Cash and equivalents at end of period

 

 

54,952

108,566

64,321

70,596

97,800

Net (debt)/cash

 

 

(68,096)

(60,260)

(46,586)

(24,859)

2,345

Source: company reports, Edison Investment Research


General disclaimer and copyright

This report has been commissioned by Basilea Pharmaceutica and prepared and issued by Edison, in consideration of a fee payable by Basilea Pharmaceutica. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2024 Edison Investment Research Limited (Edison).

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

General disclaimer and copyright

This report has been commissioned by Basilea Pharmaceutica and prepared and issued by Edison, in consideration of a fee payable by Basilea Pharmaceutica. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2024 Edison Investment Research Limited (Edison).

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

More on Basilea Pharmaceutica

View All

Latest from the Healthcare sector

View All Healthcare content

Research: TMT

Altron — Rising star

Altron is a South African-based provider of platforms and IT services, helping businesses transform and operate their IT. As part of the plan to refocus on strategic growth opportunities and to improve profitability, management has set ambitious medium-term profit targets. The group has made good progress to date, and we forecast a headline EPS CAGR of 21% from FY23 to FY26e. In our view, this performance is not yet reflected in the current share price. Full FY24 results in May should provide better clarity around individual business performance and we expect the discount to peers to reduce as positive margin progress becomes evident.

Continue Reading

Subscribe to Edison

Get access to the very latest content matched to your personal investment style.

Sign up for free