Circassia (LON:CIRCI)’s recent interims demonstrated 55% y-o-y revenue growth to £28.4m and a 75% R&D expense reduction (to £6.9m from £27.2m in H117) while growing the commercial infrastructure that now includes China. Investors should see a path to profitability, but we note recent licensing opportunities in the respiratory therapeutic area could accelerate this.
Circassia’s transformation
Circassia has moved past R&D disappointments and transformed into a respiratory specialty pharmaceutical company with the potential for profitability. Circassia’s revenues (from its respiratory products Tudorza for COPD and NIOX) grew to £28.4m in H118 from £18.3m in H117. Just as important was the cost discipline, as illustrated by a 26% y-o-y fall in operational costs, helped by a 75% reduction in R&D spend. Circassia ended H118 with £50.8m in cash (£59.5m at YE17).
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