Daily Brief Health Care: Ionis Pharmaceuticals, Terumo Corp, Grifols SA, Hangzhou Jiuyuan Gene Engineering, JTEC Corp/Osaka, Grace Therapeutics, SIGA Technologies, BioStem Technologies and more

• Ionis Pharmaceuticals recently reported their third-quarter financial results for 2024, presenting a comprehensive view of its current position in the biotechnology sector.
• The company’s focal points include imminent product launches, ongoing clinical trials, and strategic pipeline developments—all set within the context of their financial performance and future outlook.
• The company is on the verge of launching its first independently marketed product, Olezarsen, for familial chylomicronemia syndrome (FCS), with an anticipated FDA action next month.

• Terumo Corp (4543 JP) reported better-than-expected H1FY25 result, with revenue, operating profit, and net profit all reached record highs for the first half. Profit margins continued to improve.
• Revenue from C&V business grew 15% YoY to ¥306B (~60% of total revenue). More than 60% of the growth came from TIS (catheter) division, which grew 14% YoY to ¥201B.
• Terumo has revised FY25 guidance upward, reflecting strong performance and changes in foreign exchange assumptions. Both revenue and profits are expected to reach record high in FY25.

• Since mid-October, share-price spreads have generally tightened across European liquid universe of ordinary and preferred shares (10 have tightened, 9 widened). Most spreads that were already tightening, kept doing so.
• Most spreads that were already tightening, kept doing so. Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe.
• Recommended trades long ordinary / short preferred shares: Carlsberg, Henkel, SSAB Svenska Stal.

• Based on current performance, Jiuyuan has lost growth momentum, showing signs of stagnant growth. The main reason is VBP. So far, Jiouting, Yinuojia, Jifuwei have been included in VBP.
• Guyoudao is facing competitive pressure from both domestic and international competitors and could be finally included in VBP. JY29-2 is the next blockbuster product, but the prospects are not clear.
• Jiuyuan’s market value is expected to be higher than Qyuns. Future valuation performance will depend on the progress of JY29-2 and the overall market situation of GLP-1s at that time

• Improving sales mix lift gross margins – Gross margin increased to 65.9% in Q1 FY6/25 from 52.5% the previous year, demonstrating an improvement in the sales mix at the core Optical business segment which experienced demand for high-precision products with premium pricing.
• While operating losses remained relatively flat YoY, the company is investing in IT systems that will improve its production and sales management which we believe will improve the quality of earnings, as well as assist in new business development.
• Overall, we believe the company performed in line with guidance, with no change regarding expectations of the earnings profile to be concentrated in H2 FY6/25.

• Grace is a clinical-stage, biotechnology company focused on rare disease.
• Its lead program, GTX-104, is a novel injectable formulation of nimodipine for the treatment of aneurysmal subarachnoid hemorrhage (aSAH).
• Other programs include GTX-102 for Ataxia Telangiectasia & GTX-101 for postherpetic neuralgia.

SIGA Technologies reported revenues of $10m in Q324, attributed primarily to deliveries under the $112.5m BARDA option, exercised in July 2024. Backed by a strong order book ($146m at end-Q324), the sales momentum has picked up pace in Q424 with another $51.2m and $8.5m of oral and IV TPOXX (IVT) delivered to the Strategic National Stockpile (SNS) in October 2024. We expect further deliveries in Q424 and early 2025 under the BARDA contract as well as the $9m US Department of Defense (DoD) order received in August 2024. Q424 also marked SIGA’s first commercial foray into Africa (delivering oral TPOXX to Morocco worth c $0.8m), capped by in-licensing of a novel preclinical monoclonal antibody from Vanderbilt University to complement TPOXX in targeting orthopox viruses. We await further updates on the PEP label expansion and mpox trials but conservatively adjust our estimates to reflect results from the PALM 007 study. Our valuation adjusts to $13.93/share from $15.89/share previously.

• BioStem Technologies is a leading innovator focused on harnessing the natural properties of perinatal tissue in the development, manufacture, and commercialization of allografts for regenerative therapies.
• The company’s stock has suffered the last few days, largely, it seems, due to two of its major products not being on the just released LCD coverage list.
• There’s more to the story, and we reiterate our recently upgraded price target.