jurpsy schreef op 24 oktober 2019 20:29:
H.C. Wainwright / PHARM.AS:
3Q19 Results; Ruconest Continues to Grow and Support Pipeline Expansion; Target Upped to EUR 3.10
Pharming Group NV
PHARM.AS: Price: €1.16; Market Cap (M): €728
Rating: Buy; Price Target: €3.10 Joseph Pantginis, Pharming.D.
3Q19 Results; Ruconest Continues to Grow and Support Pipeline Expansion; Target Upped to EUR 3.10
Financial update. This morning, Pharming announced 3Q19 results, posting EPS of €0.02 compared with our estimate of €0.01, as the company continues to build upon its net profitability on growing Ruconest sales. Ruconest revenues for 3Q19 were €45.3 million, compared to our estimate of €43.8 million which reflected an increase in the number of patients using the drug both in the U.S. and E.U. The company ended 3Q19 with €64.4 million in cash which reflect growing Ruconest sales and an upfront payment to Novartis of €17.9 as part of the license agreement relating to leniolisib announced in August. We expect these revenues to be bolstered over the long-term by potential expansion into additional indications and in the nearer term by: (1) core Ruconest growth in HAE; and (2) potential bolstered core growth with new and improved formulations. Management expects 4Q19 results to reflect those of 3Q19 with a balance between: (1) growing physician and patient familiarity with Ruconest for HAE as the drug is still relatively early in its North American launch cycle; (2) growing traction evidenced by revenue growth; and (3) competitive pressures.
3Q19 Highlights; Ruconest grows and expands to new indications; Intriguing pipeline development. In 3Q19 Pharming reported strong financial and operational updates which we believe confirm the validity of the company's business development strategy. The results highlight: (1) Ruconest growth mainly driven by the U.S. market and operations; (2) continuous efforts to expand Ruconest's production to support its growing market opportunity in U.S., E.U. and beyond; (3) pipeline expansion building upon Ruconest’s success both by exploring additional indications for the drug (starting with pre-eclampsia and acute kidney injury) and the potential of a new product (leosinib, licenced from Novartis (NVS; not rated)). We remind investors that, capitalizing on Ruconest’s clinical potential and valuing the company's ongoing business strategy are core to our investment thesis.
Ruconest revenues continue to grow supporting its commercial thesis. We believe Ruconest's growing revenue in HAE speaks to the strong execution of the company’s business strategy. Recall that Ruconest entered a relatively crowded market, characterized by a rapidly changing landscape, with increasing competition, especially in the prophylactic space, with higher response rates and improved profiles. However, Ruconest has had, and continues to have advantages due to: (1) the continuous need for drugs able to treat the acute and breakthrough attacks characteristic of HAE; (2) its reliability and consistency of responses, which continue to provide confidence to patients adopting the drug as their preferred treatment; and (3) positive patient experience which boosts the Ruconest profile where other drugs are not delivering. Therefore, Ruconest may capture both severely affected patients and those looking for a reliable treatment for their breakthrough attacks (which expands the growth opportunities for Ruconest beyond acute treatment). We expect Ruconest revenues to continue to grow over the long-term bolstered by potential expansion into additional indications and in the nearer term by: (1) continued core growth in HAE through increased patient numbers despite competitive pressures; and (2) potential growth with new and improved formulations. The company also recently completed its planned investment into its Fill and Finish partner, BioConnection (private) for capacity expansion.