First Berlin – NOXXON Pharma NV Research Update (11/05/2018)

First Berlin Equity Research has published a research update on NOXXON Pharma NV (ISIN: NL0012044762). Analyst Christian Orquera reiterated his BUY rating and decreased the price target from EUR 28.00 to EUR 20.00.

Noxxon published FY/17 financial results, which were roughly in line with our expectations. Following successful downsizing measures, the company's operating loss narrowed significantly to €4.7m (FBe: €5.0m, FY/16: €8.6m). However, Noxxon's financial situation is still challenging. The company reported a cash position of €0.6m (FBe: €1.1m, FY/16: €2.2m) as of the end of 2017. After taking into account of the March 2018 financing measures, Noxxon still requires an additional approx. €3.2m to fund operations for the next twelve months. The company is exploring several alternatives, including looking for existing and new investors, industrial partnerships and also M&A. Management is confident that additional capital will be raised in the near term. Further, patient recruitment for the ongoing NOX-A12/Keytruda trial is progressing well and 17 out of 20 planned patients had been enrolled by the 20th of April. Management is on track to report part 1 NOX-A12 biopsy monotherapy data during Q2/18, as well as top-line efficacy data from the part 2 NOX-A12/Keytruda combination study in Q4/18. We have taken the financing risk into consideration by increasing the WACC in our SOTP valuation model to 25% (previously: 21%). Our new price target is €20.00 (previously: €28.00). Our Buy rating remains unchanged.