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Company Review
Prima BioMed Limited
1H12 Results and Dendreon Update
?? Prima Biomed (PRR) announced 1H12 results on 28 February. Revenue of
$3.0m primarily consisted of interest income ($1.55m) and grant income
($1.48m). Key expenses for the half were R&D (-$7.5m) and administrative
expenses (-$3.3m). Excluding unrealised expenses, monthly cash burn was
~$1.5m per month.
?? Significant achievements in the half include:
- Manufacturing approval achieved in Germany to allow Phase III
(CANVAS) study to proceed.
- Partnership established with City Hospital in Dubai to offer CVac as a
treatment option for wealthy clients in the region.
- Full patient enrolment completed for the Phase IIb trial.
- EUR 4.1m grant received from the German state of Saxony to fund part
of the CANVAS clinical program.
?? We also note that US-listed compco Dendreon (NAS: DNDN) reported
underwhelming 4Q results on 27 February. The results reflect company
specific issues around physicians not prescribing the treatment because of
funding delays arising out of the US health system. DNDN has also chosen
not to provide guidance in 2012 given the difficulties arising from 2011
guidance being withdrawn at the 2Q11 result.
?? We reiterate that while PRR and DNDN are developing similar
technologies, they are at completely different stages in their respective
lifecycles and should be treated as such, in our view. PRR has a well
designed pivotal study underway, which if successful will produce a whole
new dimension of treatment for sufferers of ovarian cancer.
?? Catalysts in the short term include listing on the NASDAQ (where a
registration statement has been filed) and the receipt of Australian
manufacturing approval (which has been delayed at the Australian regulator).
This is required to allow the Dubai partnership to proceed.
?? We maintain our Speculative Buy with high risk under our expanded
ratings system. The company’s success is dependent on clinical trial
results which are inherently uncertain.
Key Financials
Year-end Jun (A$) FY10A FY11A FY12E FY13E FY14E
Revenue ($m) 0.5 1.1 5.3 18.6 43.6
EBITDA ($m) -18.2 -21.0 -18.2 -15.7 -17.1
Net profit after tax ($m) -18.2 -21.1 -17.1 -15.3 -22.0
EPS (¢) -3.6 -3.7 -1.7 -1.4 -1.9
P/E (x) -6.2 -6.0 -13.3 -16.3 -12.1
EV/EDITDA -5.9 -3.8 -10.3 -13.2 -15.4
Dividend (¢) 0.0 0.0 0.0 0.0 0.0
Net Yield (%) 0.0 0.0 0.0 0.0 0.0
Franking (%) na na na na na
Normalised NPAT ($m) -18.2 -22.5 -17.0 -15.3 -21.9
Fully Diluted EPS (¢) -3.6 -4.0 -1.7 -1.4 -1.9
EPS Growth (%) 308.8 9.9 -57.9 -18.0 35.2
Normalised P/E (x) -6.2 -5.6 -13.4 -16.3 -12.1
Normalised ROE (%) -114.8 -40.8 -34.0 -23.6 -51.3
Source: IRESS, Company data, Ord Minnett estimates
PRR A$0.225
Recommendation
Speculative Buy
Risk Assessment
High
Biotechnology
Brad Dunn
Analyst
[email protected]
Prima BioMed Limited
ASX Code PRR
52 week range A$0.42 -A$0.14
Market Cap A$221m
Shares Outstanding 980m
Av Daily Turnover A$2.38m
ASX All Ordinaries 4363.4
ASX200 Industrials 3762.9
NTA FY12 (¢ per share) 4.9
Net Cash FY12 ($m) 39.0
Relative price performance
Source: Iress
Consensus earnings
FY12E FY13E
NPAT (C) - -
NPAT (OM) - -
EPS (C) - -
EPS (OM) - -
Source: Iress
40.0
60.0
80.0
100.0
120.0
140.0
160.0
180.0
Mar-11 May-11 Jul-11 Sep-11 Nov-11 Jan-12
XJO XSO PRR
Monday, 5 March, 2012
Disclosure: Ord