Starpharma Holdings Limited
 

SPL Details
 
VivaGel® BV Launched in Multiple Markets: Starpharma Holdings Limited (ASX: SPL) is engaged in research, development and commercialisation of dendrimer products for the pharmaceutical, life-science and other applications.

Recent Updates:
FDA Authorisation for Clinical Trial with AstraZeneca:The company recently notified that the U.S. Food and Drug Administration (USFDA) has authorised the use of AstraZeneca’s DEP® Bcl/Xl conjugate AZD0466 in clinical trials. The company is expecting to commence AZD0466 clinical program later in 2019, following set-up and necessary approvals. AZD0466 is a nanomedicine formulation that helps in improving the therapeutic margin through the use of Starpharma’s DEP® delivery technology.

Update on DEP® Irinotecan: The company recently updated on the significantly enhanced efficacy benefits,depicted by DEP®irinotecan, its patented clinical stage nanoparticle formulation, in comparison to standard irinotecan, Camptosar®and olaparib, Lynparza®.A combination of DEP®irinotecan and Lynparza® resulted in significant tumour regression while the other groups just helped in tumour suppression or reflected no effect at all.

Regulatory Approval for VivaGel®BV:  In another recent announcement, the company notified that it has received a further regulatory approval for VivaGel®BV in an Asian country. The product will be rolled out in Asia by Mundipharma under the brand name BETADINE™ BV Gel with launch expected in the coming months. Earlier in 2019, VivaGel® was also launched in Europe and Australia.

FY19 Financial Results: During the period ended 30 June 2019, the company generated total revenue and other income amounting to $2.7 million, as compared to prior corresponding period value of $5.0 million. The decrease in revenue was primarily due to signature milestone payments pertaining to prior year with respect to licensing of VivaGel®BV for Europe, Asia, Middle East, Africa and South America. During the year, the company reported a loss of $14.3 million, as compared to prior corresponding period loss of $10.3 million. FY19 loss reflected the expenditure on research and development along with patent costs with respect to VivaGel® and DEP® programs. In addition, the period also saw an increase in commercial and regulatory operating costs regarding licensing and launch of VivaGel®BV in multiple markets. During the year, the company also received a tax incentive of $4.0 million. As on 30 June 2019, the company had a cash balance of $41.3 million.


FY19 Financial Results (Source: Company Reports)

Key Activities in FY19: During the year, VivaGel® BV was launched in Europe and Australia under the brand names BetadineBV™ and Fleurstat BVgel, respectively. In addition, the company received the first Asian regulatory approval for Betadine™BV Gel.The company also secured a patent for SPL7013 ophthalmic drops for viral conjunctivitis, after independent market research conducted in the US. During the year, the first patent for DEP® dendrimers with AstraZeneca’s Bcl2/Xl inhibitors, including AZD0466 was also secured.

Outlook: The company is looking forward to further launches of VivaGel® BV for building the sales momentum. In addition, it will continue to progress on three clinical stage internal DEP®products alongside AstraZeneca’s first DEP® product, AZD0466. In order to build further value in DEP® products, the company will focus on potential expansion opportunities for its clinical programs.

Stock Recommendation: The stock of the company generated negative returns of 5.60% and 20.94% over a period of 1 month and 3 months, respectively. In FY19, the company achieved significant milestones in the form of international product launches, trial progress for three high-potential clinical stage DEP® products and new commercial deals. The company saw the launch of VivaGel® BV in Europe and Australia along with regulatory approvals for launch in Asia. The product has now been launched in more than 160 countries and will see further approvals and launches in coming months across Mundipharma’s regions. The DEP® portfolio saw development in the form of a commercial deal with AstraZeneca along with the progress in internal clinical DEP®programs.Currently, the stock is trading slightly below the average of 52 week-high and low levels of $1.662 and $0.870, respectively. Hence, considering the above factors and current trading levels, we give a “Hold” recommendation on the stock at the current market price of $1.180, up 7.763% on 26 September 2019, owing to USFDA approval for the clinical trial with AstraZeneca’s DEP product.
 

SPL Daily Technical Chart (Source: Thomson Reuters)

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