Basilea Pharmaceutica - Oncology milestone payment triggered

As expected, Basilea continues to derive value from its oncology exit as it has received a transition-related milestone payment of US$4m (CHF3.7m) from its licensing partner SillaJen triggered by the progression of the oncology asset BAL0891 towards Phase I clinical studies. The company had previously received an upfront payment of US$10m (CHF9.3m) following closure of the deal with SillaJen in September 2022. As part of the licensing agreement, Basilea is set to receive potential future performance-based milestone payments of up to c US$320m (c CHF297m) and is also entitled to tiered royalties on net sales, which will range from single- to double-digit percentages. Basilea remains responsible for making milestone and royalty payments to the licensor, NTRC, for BAL0891. We value Basilea at CHF921.7m or CHF77.8/share (previously CHF903.5m or CHF76.3/share).