Sedana Medical AB doesn’t have its own thread, although I believe it’s on many investors’ radar or even in their portfolios, at least if they are focused on medtech stocks. The company was founded in 2005 and its headquarters are in Stockholm. The company specializes in sedation and aims to facilitate and even partially revolutionize intensive care by applying a lighter, non-invasive method for patient sedation through inhaled sedation. The product’s advantages include easier patient control and lighter, less invasive treatment. At the same time, it is evident that this is in some places a cheaper and more effective treatment method, but on the other hand, this treatment model cannot be applied to all patients.
On the one hand, the company is in a mature phase in that it generates revenue, just under four million euros per quarter, but on the other hand, it is in a development phase in the sense that its EBITDA is -4%. It has just over 10 million euros in cash, and the burn rate in the last quarter was approximately three million euros.
I initially entered this investment with a so-called observation position, because the company’s product, especially during the COVID years, felt very timely and interesting. Unfortunately, the company’s cash flow is still weak, and sales have not quite met the wildest expectations. Therefore, from a financing perspective, the company is likely still dependent on share issues, and it is difficult to form a clear understanding of future stock price development. On the other hand, precisely at this stage, after a somewhat soft quarterly report, it might be a good time to invest in the stock of this intensive care-revolutionizing company. Hopefully, the medtech experts in the Inderes community can contribute to analyzing this uncut diamond. In any case, investors are in good company, as the largest owner is the long-term experienced medtech investor Bengt Julander with a 13.6% stake; ownership is otherwise diversified. At worst / best, this promising early-stage company might fall into the lap of a larger entity at a good price, but of course, the most interesting outcome would be to secure a good long-term investment from this.