First Berlin – IntelGenx Technologies Corp. Research Update (02/10/2019)

First Berlin Equity Research on 02/10/2019 initiated coverage on IntelGenx Technologies Corp. (ISIN: US45822R1014/ Bloomberg: IGXT US IGX CN). Analyst Christian Orquera placed a BUY rating on the stock, with a USD 1.20 price target.

Abstract
IntelGenx Technologies Corp. is a Canadian drug delivery specialist developing oral products with superior characteristics to the originally established therapeutics (branded drugs) and which address important unmet medical needs. The company has used its proprietary backbone thin film technology VersaFilm? to generate a broad development-stage product pipeline. To capture higher margins, the company has also established its own oral thin film production facility. At present, IntelGenx has 11 thin film products, of which four are on track for commercialisation in the course of 2020 and 2021. We anticipate that IntelGenx' cannabis-infused film for adult recreational use will launch in Q1/2020 in Canada, followed by the improved generic drugs Rizaport against migraine (Q2/2020; US), Exordia for erectile dysfunction (H1/2021; US) and the opioid anti-dependence drug Buprenorphine/Naloxone (H2/2021; US). The period 2020-2021 represents an inflection point in IntelGenx' history. Assuming the successful approval and market launch of these products, we anticipate group sales will increase from USD2m in 2018 to USD42m in 2022. We also expect the company will become profitable in 2021. Based on our sum-of-the-parts (SOTP) valuation model, we arrive at a USD1.20 price target. We initiate coverage of IntelGenx with a Buy rating.