European PAES And Myasthenia Trials Will Unlock Future Markets

Key Takeaways

• Completion of key trials and expanding access to Idefirix are expected to enhance revenue and market position in Europe.
  
• New trials and regulatory advances in myasthenia gravis present opportunities for revenue growth by addressing unmet medical needs.
  
• Leadership changes and fluctuating revenues create uncertainty, while restructuring, regulatory risks, and trial delays highlight potential challenges to growth and earnings stability.

Catalysts

A biopharmaceutical company, engages in development and commercialization of treatments for patients with rare immunological conditions in Sweden, North America, and rest of Europe.

• The completion of enrollment in the post-authorization efficacy and safety (PAES) Phase III study in Europe for Idefirix, supporting full marketing authorization by 2026, is expected to enhance product sales growth as more transplant centers gain experience and access. This should positively impact future revenue.
  
• Positive regulatory interactions and alignment on a proposed clinical trial in myasthenia gravis for HNSA-5487 indicate potential for addressing high unmet needs, which could lead to new revenue streams and improved earnings.
  
• The continued market uptake of Idefirix in Europe, alongside new consensus guidelines and increased reimbursement in 18 countries, is anticipated to drive further sales growth, impacting revenue and net margins favorably.
  
• Upcoming data readouts from multiple key clinical trials, including a U.S. Phase III kidney transplantation study, have the potential to expand the application of their therapies, likely affecting revenue and earnings positively.
  
• Efforts to publish and present long-term trial data are expected to strengthen clinical community support and enhance market adoption, contributing to sustained revenue growth and improved net margins.

Hansa Biopharma Future Earnings and Revenue Growth

Assumptions

• Analysts are assuming Hansa Biopharma's revenue will grow by 92.0% annually over the next 3 years.
• Analysts assume that profit margins will increase from -344.4% today to 15.7% in 3 years time.
• Analysts expect earnings to reach SEK 201.4 million (and earnings per share of SEK 2.16) by about May 2028, up from SEK -625.7 million today. However, there is a considerable amount of disagreement amongst the analysts with the most bullish expecting SEK760.1 million in earnings, and the most bearish expecting SEK-388.3 million.
• In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 48.3x on those 2028 earnings, up from -2.9x today. This future PE is greater than the current PE for the GB Biotechs industry at 28.6x.
• Analysts expect the number of shares outstanding to grow by 7.0% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 6.02%, as per the Simply Wall St company report.

Hansa Biopharma Future Earnings Per Share Growth

Risks

• The departure of the CEO and change in leadership might create uncertainty and disruption, which could impact the company's strategic direction and operational execution, potentially affecting future revenues and profits.
  
• The fluctuating quarterly revenue points to unpredictability in the organ allocation market, which could create volatility and uncertainty in revenue streams.
  
• The necessity for ongoing restructuring and cost management indicates potential financial strain, with SG&A and R&D expenses already being reduced, possibly affecting net margins if further cuts impact growth initiatives.
  
• The conditional approval of Idefirix, tied to specific studies that are yet to receive full approval, poses a risk if results are not as favorable as expected, which could affect future earnings potential.
  
• Temporary halts in clinical trials due to safety updates could delay product developments and market entry, impacting long-term revenue growth and creating uncertainty about future earnings.

Valuation

• The analysts have a consensus price target of SEK98.333 for Hansa Biopharma based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of SEK143.0, and the most bearish reporting a price target of just SEK32.0.
  
• In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be SEK1.3 billion, earnings will come to SEK201.4 million, and it would be trading on a PE ratio of 48.3x, assuming you use a discount rate of 6.0%.
  
• Given the current share price of SEK26.72, the analyst price target of SEK98.33 is 72.8% higher.
  
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.