Sparks - Basilea Pharmaceutica

Basilea has materially raised its FY26 outlook, with Cresemba and Zevtera-related revenue now expected at c CHF250m versus CHF210m previously and operating profit at c CHF115m versus CHF70m previously. The upgrade is primarily driven by higher expected milestone income, which has increased to c CHF65m from CHF35m. We believe this likely reflects sizeable Cresemba sales milestones from both Pfizer and Astellas across their respective territories (we estimate around CHF30m each). The remainder of the revenue upgrade is attributed to increased royalties (CHF5m) and higher product revenues (CHF5m). R&D expenses are also now expected at c CHF125m versus CHF127m previously. This benefit is reflected in the increase in operating profit expectations, highlighting the strength of Basilea’s capital-efficient, partner-led business model. Driven by the strong sales traction across the board, Basilea has also raised its 2026–30 cumulative cash flow target for Cresemba and Zevtera to CHF650m from CHF600m (of which CHF215m is expected to be realised within FY26).

The CTB-LEDA update is also positive. Following FDA and EMA discussions, Basilea now plans a Phase II/III study rather than potentially requiring two separate Phase III trials, and the Phase II part is expected to read out by end-2028. The lower patient numbers should support relatively lower development costs, with BARDA backing the programme with its up to US$159m R&D commitment. Trial initiation is guided for mid-2027, with top-line readout likely in 2029. Fosmanogepix Phase III readouts remain targeted for mid-2028, with recruitment complete in the salvage therapy cohort of the invasive mould study. Basilea is due to hold its capital markets day tomorrow, 28 October, when we expect further detail on the fosmanogepix development and filing strategy, as well as the broader Agenda 2030 outlook.