PharmaMar (MC:PHMR) has capped off a strong performance in 2016 by signing a licence deal with Chugai (T:4519) for lurbinectedin (PM1183) in Japan, including €30m upfront and over €70m in potential milestones.
The outlook for 2017 is similarly promising, including a potential EMA approval decision for Aplidin in multiple myeloma, Phase III data for lurbinectedin in ovarian cancer, and potential initiation of a pivotal trial of lurbinectedin in a third indication (BRCA-associated breast cancer). We have substantially revised our valuation assumptions, but the end result is that our valuation is little changed at €1.01bn (€4.55/share).
Licence deal for lurbinectedin in Japan
The Chugai deal for Japanese rights to lurbinectedin is a positive development for PharmaMar, in a territory where we had not previously assigned any value for lurbinectedin in our forecasts. It suggests PharmaMar could negotiate substantial upfront and milestone payments for a licence deal in the larger U.S. market.
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