Basilea - Additional $30m from BARDA

This morning, Basilea announced a further award of $30 million in non-dilutive funding as part of its agreement with BARDA to support the development of Basilea’s novel antifungal fosmanogepix. The payment has been received, as Basilea has met a pre-specified enrollment threshold in the ongoing Phase 3 programme. As a reminder, this funding is received under BARDA and Basilea’s 2024 ‘Other Transaction Agreement’, which awarded up to $268 million over 12 years. Overall, funding from BARDA is expected to cover approximately 60% of ongoing development costs.

With the Phase 3 programme for fosmanogepix underway, we look forward to data from the candidaemia/invasive candidiasis study and the invasive moulds (open-label) study to confirm the excellent profile of fosmanogepix highlighted in Phase 2. In the interim, we also look forward to more data from the expanded access programme, which has already demonstrated the utility of fosmanogepix in treating previously intractable fungal infections. Basilea has previously reported that fosmanogepix has been used in over several hundred patients across more than 10 countries with invasive fungal infections, including aspergillosis and candidiasis.

Further data from expanded access programmes could provide additional insight into the activity of fosmanogepix, complementing data from the clinical trial setting. This could potentially expand its commercial potential and help save more lives, particularly where existing treatments have failed or where no suitable treatment is available. Our own peak sales forecast of c. $1.2bn reflects the attractive profile of fosmanogepix, including its activity against most of the important fungal infections highlighted by WHO.

As we highlighted in our recent research note, Basilea is well positioned for long-term growth. The company expects to continue generating strong cash flow through to 2030, with approximately CHF 600 million coming from its existing commercial products, Cresemba and Zevtera. With a strong late-stage pipeline and a track record of identifying high-value assets in the anti-infectives arena, Basilea has a bright future.

We have a DCF-derived fair value of CHF120 per share.

To read all our Basilea research, please use the link here.

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