We published a research note this morning, updating our thoughts following the progress of Basilea’s lead cancer prospect, derazantinib.
Derazantinib is an FGFR inhibitor (FGFRi). This drug class has delivered remarkable results, with early regulatory approvals achieved in difficult to treat cancers, including urothelial and bile duct. Derazantinib targets both of these diseases, as well as gastric cancer, but with increasing competition from other FGFRis, management has adapted its development strategy to ensure its commercial success. Efficacy and safety data have been encouraging and suggest that a higher dose of derazantinib should be manageable and provide the best possibility of generating a class-leading response compared to the competition. However, our enthusiasm for derazantinib is primarily due to its additional ability to target colony-stimulating factor 1 receptor (CSF1R).
CSFR1 plays a vital role in maintaining a favourable tumour microenvironment, and derazantinib’s additional activity should boost the activity of the widely used checkpoint inhibitors (CKIs). The checkpoint inhibitor market is worth roughly $20bn and is dominated by large pharma companies such and Merck, Bristol Myers Squib and Roche.
Our research details the recent development in the FGFRi market and Basilea’s progress. We believe that derazantinib’s differentiation should allow it a key role in this market, both as a monotherapy and in combination with the CKIs. We expect to see important clinical data reported in 2022.
Supporting derazantinib, Basilea has a fast growth revenue-generating anti-infectives portfolio and an early-stage pipeline asset, lisavanbulin, which has already shown profound responses in brain cancer, albeit in a small number of patients.
We calculate a discounted cash flow fair value of CHF120 for Basilea.
For all our research on Basilea, please use the link here.
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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 contained in this publication should be considered as any form of advice.