Commissioned research: Oasmia Pharmaceuticals

Decision time

Oasmia Pharmaceuticals is an innovative pharmaceutical development company focused on next‐generation chemotherapy drugs for both human and animal applications.

Oasmia Pharmaceuticals has commissioned Nordea Markets to produce a research report with the aim of providing investors with quality research on the company, which owing to its size might otherwise not receive much attention from the financial markets.

Decision time – Updated 5 March 2018

CHMP opinion expected in April

Oasmia reported an operating loss of SEK 25.2m in Q3 compared with a loss of SEK 34.9m last year. Net sales were SEK 0.7m in Q3, driven by invoiced deliveries of goods to its partner in Russia.

The supplementary data analysis regarding a previous PK study for Apealea has now been completed, in response to questions from the EMA. Oasmia expects to receive a notification from the assessor during April (CHMP will host a meeting on 23-26 April), implying potential market authorisation by the summer. In addition, the process for listing Oasmia’s US subsidiary, AdvaVet Inc, is ongoing and a listing prospectus is expected to be submitted to the SEC soon.

Products begin

Sales of Paclical in Russia have formerly started, with Oasmia shipping products to its distributor during November and January. However, this is still not fully reflected in revenue, as only manufacturing costs are invoiced and it will later receive share of profit.

Estimate changes

We make some adjustments to our near-term estimates to reflect the company’s revenue recognition in Russia and the CHMP opinion on Apealea in April. Our long-term forecasts are unchanged, apart from adjustments owing to FX movements. Assuming the company can deliver on forecasts, we derive a value of share price between SEK 5.7 and SEK 6.8 per share, based on a WACC of 16.2-17.8%.

Read the full updated report here.

Activities on several frontiers – Updated 4 December 2017

Quarterly review – Oasmia Pharmaceuticals

Oasmia Pharmaceuticals reported an operating loss of SEK 22.1m in Q2 compared with a loss of SEK 35.9m last year. Net sales were SEK 1.7m in Q2, driven by distribution rights, and the first Paclical order in Russia was shipped in November. The company also reiterated its ambition to list its veterinary assets in the US, which will likely happen during the first half of next year. The registration process for Apealea in Europe has been a bumpy ride. In September, the company requested extra time (clock stop) to compile supplementary analysis of data from a previously conducted pharmacokinetic study, in response to a question from the assessor. Oasmia intends to submit the results as soon as possible, implying an EMA decision in the next few months.

Estimate changes

We make adjustments to our near-term estimates to reflect a delayed EMA decision, which pushes sales uptake in the EU and the US. Our long-term assumptions are largely unchanged.

Proprietary drug delivery technology

Oasmia is an innovative pharmaceutical development company focused on next-generation chemotherapy drugs for human and animal applications. Its product pipeline is built on an in-house developed drug delivery technology, XR-17, which enhances formulations by creating micelles that encapsulate the API and improve water solubility without the use of any toxic solvents.

Late-stage assets

Founded almost 20 years ago, Oasmia has been on a long journey, but it could soon be able to capitalise on its early research efforts. Paclical, its lead asset and a combination of paclitaxel and XR-17, has completed ph III and is awaiting a response from the EMA about market approval.

We provide the full report here.

Updated 4 September 2017, with Quarterly review

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Updated 19 June 2017, with impressions from Oasmia’s 2017 CMD

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Updated report – 13 June 2017

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The Commissioned Research Report on Oasmia Pharmaceuticals does not contain a target price or recommendation, and we do not provide investment advice on the company. Rather, the report is an outline of some of the most important factors to consider when investing in Oasmia Pharmaceuticals, including a company overview, a valuation discussion, Oasmia Pharmaceuticals management introduction, historical financials and market outlook, as well as some key risks that the company may face. This is not an exhaustive description of the company or the risks related to it, and it should not be relied on as such, nor is it a substitute for the judgement of the recipient.

Nordea Markets is the commercial name for Nordea’s international capital markets operation. The information provided herein is intended for background information only and for the sole use of the intended recipient. The views and other information provided herein are the current views of Nordea Markets as of the date of this document and are subject to change without notice. This notice is not an exhaustive description of the described product or the risks related to it, and it should not be relied on as such, nor is it a substitute for the judgement of the recipient. The information provided herein is not intended to constitute and does not constitute investment advice nor is the information intended as an offer or solicitation for the purchase or sale of any financial instrument. The information contained herein has no regard to the specific investment objectives, the financial situation or particular needs of any particular recipient. Relevant and specific professional advice should always be obtained before making any investment or credit decision. The document has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination.
Nordea Bank AB (publ), Company registration number/VAT number 516406-0120/SE663000019501. The board is domiciled in Stockholm, Sweden.

Conflict of interest

Readers of this document should note that Nordea Markets has received remuneration from the company mentioned in this document for the production of the marketing material. The remuneration is predetermined and is not dependent on the content. It is important to note that past performance is not indicative of future results. Nordea Markets is not and does not purport to be an adviser as to legal, taxation, accounting or regulatory matters in any jurisdiction. This document may not be reproduced, distributed or published for any purpose without the prior written consent from Nordea Markets.

Issuer review

This report has been reviewed, for the purpose of verification of fact or sequence of facts, by the issuer of the relevant financial instruments mentioned in the report prior to publication. The review has led to changes of facts in the report. Completion date: 5 March 2018, 08:11 CET

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