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Basilea - Fleshing out the Chinese Cresemba franchise

This morning, Basilea announced the approval of its anti-fungal Cresemba (isavuconazole) for invasive aspergillosis (IA) in China. This was anticipated and follows Cresemba's December 2021 oral formulation approval for invasive mucormycosis in China.

IA is a life-threatening disorder with a high mortality rate, resulting in potential hospitalisation of up to one month, and represents the major opportunity for Cresemba. Pfizer has also filed for Chinese approval of the intravenous formulation of Cresemba for both invasive mucormycosis and invasive aspergillosis which is currently under regulatory review.


As we have noted previously, the strong financial performance of Cresemba is important as Basilea endeavours to progress its oncology pipeline. In particular, the FGFR inhibitor derazantinib is progressing through three clinical trials in FGFR driven cancers, including urothelial, gastric and biliary cancer. The FGFR inhibitor class is a highly competitive field.

However, Basilea is looking to differentiate by showing the potential of derazantinib to boost the activity of the checkpoint inhibitor Tecentriq (atezolizumab) in the urothelial and gastric cancer settings.


Nevertheless, Cresemba is an important product in its own right, with anti-fungals remaining an unmet need driven by an increase in the severely immunocompromised patient population, primarily as a result of aggressive chemotherapy as well as transplantation. Cresemba possesses a differentiated profile with an extended-spectrum. Cresemba's commercial success is driven by its excellent tissue distribution, oral bioavailability, safety and highly predictable pharmacokinetics, with little interpatient variability. The importance of the differentiated profile of Cresemba has been endorsed by the attraction of two pharmaceutical heavyweight commercial partners, Astellas and Pfizer, each already possessing an impressive anti-fungal franchise. The strength of these partners along with Cresemba's differentiated profile has been reflected in impressive end-market sales, estimated at over $300m in the 12 months to September 2021, and representing excellent growth of 26.5% - the vast majority from the agreement with Astellas in the US.


We calculate a discounted cash flow fair value of CHF120 per share for Basilea.


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IMPORTANT:

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.

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