Daily Brief Health Care: Mayne Pharma, Northeast Pharmaceutical A, Doctor Care Anywhere, OSE Immuno, Respiri Ltd, Neurovive Pharmaceutical Ab, Innovent Biologics Inc and more

• Mayne Pharma (MYX AU) reported triple-digit revenue growth in branded products division in H1FY23, driven by oral contraceptive Nexstellis, which contributes ~80% of segment sales.
• The company had an encouraging start to H2FY23. Both Nexstellis and dermatology are expected to exit FY23 with a positive run-rate contribution.
• The company has decided to cancel the previously proposed pro rata capital return and intends to use its cash in a better and productive way.

• Leading Chinese drug-ingredients supplier Northeast Pharmaceutical Group Co. Ltd. was fined 133 million yuan ($19 million) for abusing its dominant market position in materials used to make a treatment for kidney dialysis patients.
• The market regulator in northeastern China’s Liaoning province conducted a three-year investigation of Northeast Pharmaceutical’s monopoly in the market for ingredients to make levocarnitine.
• The medicine is used to treat dialysis patients for a lack of carnitine, a substance that helps the body convert fat into energy

Edison Investment Research is terminating coverage on Doctor Care Anywhere (DOC). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant.

OSE Immunotherapeutics has announced that the data from its earlier Phase I study for OSE-127/S95011, initially released in 2019, has been published in the Journal of Immunology. The study, involving 63 healthy volunteers, was a first-in-human, randomised, double-blind, placebo-controlled trial that demonstrated a promising safety and tolerability profile for OSE-127. This candidate is a monoclonal antibody therapy being assessed as a treatment for primary Sjögren’s syndrome (pSS) and ulcerative colitis (UC) in two ongoing Phase IIa studies (NCT04605978 and NCT04882007). Patient enrolment for the pSS trial was completed in Q422, with updates expected in H123; readouts for UC are expected in FY23. While we caution read-across between studies, we believe the high target occupancy observed in the Phase I study, along with a favourable safety profile, support the ongoing clinical programmes involving OSE-127.

Respiri’s H123 report summarised an eventful period, marked by commercial traction (six client wins; patient onboarding commenced at four centres) and recognition of the first remote patient monitoring (RPM) revenue from the Centers for Medicare & Medicaid Services (CMS). H123 revenues were A$0.6m (primarily R&D tax credits), lower than A$0.7m in H122, but we expect (wheezo-related) product sales to ramp up with increased patient onboarding and associated annuity income. The partnership-based US commercial strategy, along with tight checks on expenses, benefited operating performance, with the adjusted EBITDA loss improving 15% y-o-y to A$2.3m. The end-H123 cash balance of A$0.2m was bolstered by the A$1.9m post-period equity raise, which we estimate will provide runway into Q124. We adjust our estimates to reflect H123 performance and FX changes, which resulting in revising our valuation to A$165.5m or A$0.20/share (from A$189.1m or A$0.24/share previously).

Edison Investment Research is terminating coverage on Abliva (ABLI). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant.

• There’s no need to imagine that biotech can cover each hospital department/each field comprehensively just like Innovent/BeiGene has done in PD-1 era, which is the dividend of a special era.
• When PD-1 sales are gradually approaching the ceiling, the extra or fewer several hundred million yuan of PD-1 sold by Innovent wouldn’t have a fundamental impact on its market value.
• IBI362 would be a product at billions level,which means revenue would be doubled. It takes time for Innovent to turn losses into profits,but sales forecast of RMB10 billion is achievable.