Hansa Biopharma is a Swedish-listed biotechnology company whose first commercial product is an anti-rejection drug used in organ transplants. Bringing a new drug to market naturally involves considerable risks, but the results to date are promising. It is noteworthy that the same technology can be used to develop several other drugs, e.g., for autoimmune diseases.
The share price (95 SEK) has been in a considerable slump as impatient money has not been able to wait for results. Several years of negative cash flow are expected. At this rate, the company’s cash will last for another year and a half. Would it be time to jump on board?
Redeye gives a target price of 410 SEK (Base), 175 SEK (Bear), 600 SEK (Bull). The analysis can be downloaded by logging in to the service. (redeye.se)
Link to the interview /Senior Medical Director Jan Tollemar from Hansa Biopharma is interviewed by equity analyst Ludvig Svensson at Erik Penser Bank. / https://www.youtube.com/watch?v=wL9826NcvPc
“Hansa is a Swedish biopharmaceutical company in the commercial stage that has developed a unique platform focused on an immunomodulatory enzyme technology. Hansa stands out as one of few Swedish listed research companies that has taken its product all the way from preclinical research to obtaining market approval and launching a finished drug. The company’s primary drug candidate, imlifidase (commercial name Idefirix), is an enzyme that cleaves IgG (immunoglobulin G) antibodies. In 2020, Idefirix received conditional approval in Europe as a pre-treatment for highly sensitized patients undergoing kidney transplantation.”
Hansa Biopharma is leveraging its proprietary enzyme technology platform to enable immunomodulatory treatments for transplants, rare immunoglobulin G (IgG)-mediated autoimmune conditions, gene therapy and cancer.
The Company’s lead product candidate, imlifidase, is an antibody-cleaving enzyme being developed to enable kidney transplantation in highly sensitized patients and may be further developed for use in other organ and tissue transplantation and acute autoimmune indications. The European Commission has conditionally approved Idefirix (imlifidase) for the desensitization treatment of highly sensitized adult kidney transplant patients with a positive crossmatch against an available deceased donor.
Hansa’s research and development program is also advancing the Company’s enzyme technology to develop the next generation of IgG-cleaving enzymes with potentially lower immunogenicity, suitable for repeat dosing in relapsing autoimmune diseases and oncology. Hansa Biopharma is based in Lund, Sweden and also has operations in other European countries and in the U.S.
Why invest now? You can probably join later. I invest for the short and long term; they are in the same package.
There must be short-term, concrete milestones, not just the number of new customers or similar, but in euros. And not like “cash flow positive by 2025” is the first euro milestone.
At one point, I came across this article about Hansa Biopharma and bought a bit, a little too early compared to today’s level.
As you can read, Haataja has a background in the field!
Hansa apparently has 1007 mSEK in cash, but it also burns through it: around 150 mSEK per quarter…
Financial summary
Solid cash position of SEK 1,007m at the end of September 2021. With its existing cash position Hansa expects its operations to be financed into 2023.
Investments in R&D in the third quarter amounted to SEK 61m (Q3’20: SEK 71m) and to SEK 163m for the first nine months of 2021 (first nine months’20: SEK 177m). SG&A expenses amounted to SEK 83m in Q3 2021 (Q3’20: SEK 52m) and to SEK 224m for the first nine months of the year 2021 (first nine months’20: SEK 140m), in line with plans.
Cash flow from operating activities for the third quarter ended at SEK -132m (Q3’20: SEK 5m) and
SEK -365m for the first nine months of 2021 (first nine months’20: -194m).
The stock looks technically very bad. All moving averages are in a steep decline and the price is below them. Support can only be found around 70 kronor. It is advisable to wait for a price reversal before making larger purchases. This is, of course, not an investment recommendation.
It’s hard to see the company surviving without additional capital at some point. Of course, there’s still plenty of time before the cash runs dry. It would, of course, be much better to list overseas when the share price is rising rather than after such a slide. I would assume management is waiting for some positive trigger to get the share price rising and then completing the listing.
A dual listing brings additional bureaucracy and costs for a small company. On the other hand, companies like Hansa are valued higher in the US, which might be reflected in the share price.
Haataja’s update in Sijoitustieto, below are just a couple of excerpts.
From the Nordics, you can indeed find good biotech/biopharma sector companies, but for every one of those, you have to be able to reject twenty bad options. My portfolio currently includes Hansa Biopharma, Optomed, and Sedana Medical.
In my calculations, Hansa’s current enterprise value barely reflects European kidney transplant sales, so I will continue to add to the stock. This is a case where the reward will come (if it comes) only when the numbers start to be put on the table and we get FDA approval for kidney transplants, positive data for GBS and other indications, and sufficient foothold in the organ transplant market.
Perhaps my timing in “trading” this has been poor, but I would make the same decisions with the same information thousands of times over, even if the whole thing eventually falls apart for some unknown reason X.
Some news, mainly, I guess, they received input from the FDA regarding the initiation of Phase 3 development.
I can’t assess the significance myself, but maybe someone else can? At least things are moving forward…
Redeye commented that, in their opinion, making progress was an achievement rather than mere routine, as they have seen delays in several similar cases/stages.
HANSA BIOPHARMA
Hansa Biopharma; FDA opens the door for the next pivotal Phase 3 study (Redeye)
2021-11-15 11:33
In our view, Hansa Biopharma’s ability to progress the progress of the anti-GBM opportunity for the imlifidase platform is distinctly positive. This follows a successful pre-IND meeting with the FDA. Recently we have seen several FDA delays in this sector, and Hansa’s ability to timely progress this candidate to the third pivotal Phase 3 trial is an achievement.
EDIT: continued on Avanza’s discussion board; Redeye gives bold valuation levels (as it often does), Base SEK 410, Bear SEK 175 and Bull SEK 600 after yesterday’s closing price was SEK 104 after an increase.
Anti-GBM is a very rare disease (0.5-1.5 new patients per 1m per year) with different names (Good Pastures, GPS or anti-GBM). The current SoC includes repeat plasma exchange (PLEX) often combined with other immunosuppressants. At a later stage, dialysis is frequent, and the mortality level is high (Kidney impairment). In the phase 2 study, Hansa Biopharma showed promising results (dialysis independence) in anti-GBM based on imlifidase compared with PLEX. Hansa is now expecting to initiate a pivotal 50 patient study for US approval during 2022. More details will follow additional input from the FDA, and Hansa points out that the FDA seems to have confirmed the proposed primary and secondary endpoints and intended patient population.
We regard this to elevate the potential to the proven and conditionally approved core imlifidase platform. The positive share price reaction is probably a result of the general elevated FDA uncertainty, the recent pressure on Hansa’s valuation, and the European launch of imlifidase/Idefirix is a gradual launch with limited near-term volume support from highly sensitized adult kidney transplant patients. Our base case value proposition is SEK 410 (Bear SEK 175 and Bull SEK 600).
TJ, of course, looks at the matter through bull glasses, but I agree with Tom on the valuation of the stock. As a CEO, he is taking a stand on the share price in a remarkably direct way. The video was filmed on September 15, 2021, when the share closed at 122 kroner.
A new deal from the gene therapy field, which means a continuation of the Sarepta-style deals that the management had hinted at between the lines. The company in question is a subsidiary of Bayer.
USD 5 million immediately goes into the cash register.
“Under the terms of the agreement, Hansa will receive a USD 5 million payment upon execution of the agreement and AskBio will have an exclusive option to enter into a full development and commercialization agreement following evaluation of the results from an initial Phase I/II study. AskBio will be responsible for conducting the pre-clinical and clinical studies with imlifidase under the feasibility program and Hansa will supply its materials and additional support set forth in the feasibility program.”