Varithena slows, but IO strong and Lemtrada leaps
BTG's (L:BTG) close period update saw a revision to its FY16 revenue guidance, targeting sales in the lower half of £410-440m (at $1.61/£). This is based on slower-than-expected Varithena sales, despite a strong performance in the Interventional Oncology (IO) and EkoSonic businesses. We have made a number of changes to our forecasts, and even with a decrease to nearterm Varithena sales, our FY16e total revenue has increased owing to upwards revisions to IO and a large increase in Lemtrada royalties. We continue to expect ongoing investment for the future, with our FY16e net profit largely unchanged. Our updated valuation is 895p.
Varithena delays but pick up still possible
BTG now expects broadly flat Varithena sales in FY16 (£1.0m in FY15). This is owing to claim settlement processing delays leading to lower re-ordering patterns. However, with the number of physicians with experience of Varithena (including training or active treatment), in addition to patient lives covered by payers continuing to increase, we have made no changes to our peak Varithena sales ($340m), but have delayed the near-term sales ramp.
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