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Basilea Pharmaceutica

Antifungal acquisition

Dr Brian White

Andrew Keith


19 October 2023

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The ongoing success of the antifungal business provides Basilea with a strong platform to establish a world-leading anti-infectives franchise. Cresemba has grown to become the largest anti-fungal for the treatment of invasive fungal infections by value in the US and is now available in 67 countries globally. However, a looming concern has been Cresemba’s increasing maturity, with exclusivity expected to expire in US and European (after paediatric extension) markets from approximately Q4 2027. While there are other important markets, such as China and Japan, where Cresemba is still in its launch phase, we believe the loss of key markets has been an overhang on the investment case.


Executing on strategy

Basilea management has remained confident in its ability to rejuvenate the antifungal pipeline in a timely fashion. This morning’s announcement that the company has acquired a clinical-stage novel antifungal is a testament to the company’s ability to find and acquire novel agents that add longevity to the franchise. The acquisition of GR-2397 (now BAL-2062) adds a novel first-in-class agent with fungicidal activity against clinically important moulds, including Aspergillus spp. including those resistant to azoles. This a commercially important profile given that invasive aspergillosis has been the main opportunity for Cresemba. BAL-2062 has completed Phase 1 studies demonstrating a benign safety and tolerability profile. Basilea intends to conduct further preclinical work to identify optimal positioning (we note some queries regarding full spectrum of activity) and the most suitable development pathway. Phase 2 development is expected in H1 2025. BAL-2062 has QIDP, Fast Track, and Orphan designation.


Interesting profile

The treatment of invasive aspergillosis remains an important medical need affecting principally immunocompromised patients - a market growing thanks to aggressive chemotherapy regimens, particularly in haematological cancers. BAL-2062 is a cyclic hexapeptide derived from the Malaysian leaf litter fungus and was first identified by Astellas Pharma (the US partner for Cresemba). Importantly, BAL-2062 has been shown to rapidly inhibit hyphal elongation – a process which facilitates invasion of host tissues. Furthermore, this inhibition was apparently more rapid in Aspergillus spp than voriconazole suggesting a differentiated profile to the azole class in the treatment of IA.


Modest deal terms for a clinical candidate

BAL-2062 has had a convoluted recent history with Basilea acquiring it from Gravitas Therapeutics for $1.75m upfront and a total of $67m in approval and commercialisation milestones and will pay tiered royalties on sales ranging from low single-digit to mid-single digit percentage.

Basilea Income Statement (CHF 000s) 

Source: Calvine Partners Research

Basilea Cash Flow (CHF 000s) 

Source: Calvine Partners Research

Basilea Balance Sheet (CHF 000s) 

Source: Calvine Partners Research


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