Commissioned Research: Xbrane Biopharma

Xbrane Biopharma is a biotechnology company focused on developing biosimilars and complex long-acting injectable generics.

Xbrane Biopharma has commissioned Nordea Markets to produce a research report with the aim of providing investors with quality research on the company.

Xlucane development ramping up – Updated 28 August

The second quarter was characterised by a slight drop in sales and EBITDA due to ramped-up development efforts for Xlucane, along with the conclusion of a co-development deal for the same drug, with new partner STADA triggering an upfront payment of EUR 7.5m.

Read the update here

Xlucane going global – Updated 25 July

We expected that Xbrane would find a licensing partner for Xlucane in Europe and the US, but the deal signed with STADA greatly surpassed our expectations. According to the deal, STADA commits to market and sell Xlucane in Europe, the US and a variety of markets in the Middle East, North Africa and Asia-Pacific upon completed development of Xlucane and market approval from the EMA and the FDA. Previously, we had only included Xlucane sales in Iran, Europe and China in our estimates, while calculating a “what-if” valuation scenario for a successful US entry.

Read the update here

Marketing material commissioned by Xbrane Biopharma

Co-development agreement signed for Xlucane – Updated 13 July

Xbrane has entered into a co-development agreement with STADA Arzneimittel, a public German pharmaceutical company with a market cap of over EUR 5bn, for Xlucane. According to the announcement, the companies will contribute equally to development expenses, while also splitting the profits equally upon commercialisation of Xlucane. According to the deal terms, Xbrane will be responsible for developing the product until completion of the EMA and FDA requirements for market authorisation, as well as supplying the final product. STADA will be responsible for both marketing and selling the product.

Read the update here

Off to a solid start – Updated 15 May 2018

Performance in line with expectations

Xbrane reported its Q1 2018 results yesterday. Revenue reached SEK 8.6m, implying sales growth of 26% y/y, beating our estimate of SEK 8.0 by SEK 0.6m (~7%). Milestone payments from the Chinese Spherotide deal amounted to SEK 13.7m, below our estimate of SEK 22.3m. This miss resulted in EBITDA and EBIT below our estimates, but adjusted for this deviation, the underlying development of the operations was in line with our expectations. Revenue was generated solely from Spherotide’s sales in Iran, a scenario we believe will continue in the remaining quarters of 2018. We lower our estimates for milestone payments, and expect revenue and EBITDA to reach SEK 30m and SEK -32m at the end of the year. We are confident that Xbrane will meet these near-term estimates.

Long-term opportunities are intact

The Q1 report did not contain much news, and we therefore stick to our long-term investment case. We believe that several underlying structural growth opportunities have been created for biosimilar developers, and that Xbrane is well-positioned to take advantage of these through its low-cost production technique. We continue to view the upcoming clinical trials for approval of Xlucane and Spherotide in the US and Europe as the most important short-term valuation triggers. According to our estimates, Xbrane will turn profitable in 2023, while the first positive cash flow will be reported in 2024. Based on the announced product development timeline, we expect Spherotide to be launched in South Korea in 2019, while Xlucane will also be launched in Iran, thus increasing the diversification of sales.


In our view, a DCF model provides the most comprehensive valuation of Xbrane. We use a sum-of-the-parts (SOTP) DCF model to value Xbrane, and derive an equity value range of SEK 77-95 per share, based on different scenarios regarding regulatory approvals and market launches for the company’s products.

Read the full report here.

(Bio)Similar, yet different – Updated 6 April 2018

Challenging the biopharmaceutical market

Xbrane is a biotechnology company focused on developing biosimilars and complex long-acting injectable generics. The company was founded after developing a protein production technology which enables it to produce biosimilars eight times more efficiently than other standard systems, at a cost of up to 85% lower.

Structural growth opportunity

In our view, there are three market drivers which create a strong structural growth opportunity for Xbrane and other biosimilar developers: 1) The biopharmaceutical market is undergoing a “patent cliff”, as originator products with sales of SEK ~1,000bn are approaching patent expiration towards 2025; 2) Regulations have been created by medical agencies in recent years to ease the way for biosimilars to enter the market; 3) Several governments have become more focused on obtaining savings in health care spending.

All about EU and US regulatory approval

With Spherotide launched in Iran during 2017, and distribution partners signed in China, South Korea and Israel, Xbrane is on the verge of establishing a solid position in the market. Signing of distribution partners and regulatory acceptance in the US and Europe offers the largest potential valuation triggers. We use a sum-of-the-parts (SOTP) DCF model to value Xbrane, and derive an equity value range of SEK 77-96 per share, based on different scenarios regarding regulatory approvals and market launches for the company’s products.

Read the full report here.


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.
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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: 15 May 2018, 08:15 CET

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