Basilea delivers a significant upgrade
Basilea has announced it expects 2026 results to be significantly better than previously guided, as demand for its antifungal Cresemba remains strong. Specifically, higher milestone income has increased guidance for Cresemba and Zevtera-related income from CHF 210m to CHF 250m. As a result, operating profit is now expected to be significantly higher at CHF 115m (from CHF 70m), and the cash flow target detailed in Agenda 2030 has been raised to CHF 650m from CHF 600m.
The timing of the additional cash windfall is helpful, with Basilea scheduled to provide an in-depth review of the company's portfolio and pipeline at its Capital Markets Day (CMD) in Zurich tomorrow (28th October). We expect the pipeline's depth, along with the breadth of business development opportunities, to remind investors of the company's prospects to use its growing cash position to further consolidate its ambition to become a global anti-infectives powerhouse.
As a taster, the company has provided updated information ahead of tomorrow on its two Phase 3 programmes, fosmanogepix and ceftibuten-ledaborbactam. Reassuringly, fosmanogepix, which we view as the most important late-stage candidate, continues to progress through Phase 3, with recruitment into the salvage therapy cohort of the FORWARD-IM trial now complete, while recruitment into the candidaemia study (FAST-IC) continues. Basilea continues to pursue the broadest label at launch for fosmanogepix, with Phase 3 data readouts expected in mid 2028. In the interim, we look forward to further real-world data from the ongoing expanded access programmes.
FDA discussions regarding ceftibuten-ledaborbactam have been ongoing, with the company seeking a regulatory package that provides a broad, unrestricted label for patients with complicated UTIs. Following these discussions, the pivotal programme is now expected to include a Phase 2/3 trial rather than two Phase 3 trials. The advantage is twofold: fewer patients are required, and the Phase 2 study is expected to provide an early clinical readout, possibly by the end of 2028. Assuming a positive readout, this would significantly reduce the overall study design risk.
We expect tomorrow's CMD event to remind investors of the scope and potential of Basilea's anti-infectives franchise, with fosmanogepix and ceftibuten-ledaborbactam likely to take centre stage. Additionally, the earlier-stage pipeline is also becoming more tangible, with BAL2062 (invasive aspergillosis) and BAL2420 (serious Enterobacteriaceae infections) now in the clinic.
We are reviewing our forecasts and DCF valuation.
IMPORTANT:
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Basilea Pharmaceutica is a client of Calvine Partners, and as such, this publication is not independent and should be considered a marketing communication under FCA Rules. None of the information in this publication should be considered as any form of advice.
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