IRLAB Q1 2024: Progress across the board
Research Update
2024-05-13
10:27
Analyst Q&A
Closed
Fredrik Thor answered 4 questions.
Redeye returns following IRLAB's Q1 report and the news of a development collaboration related to IRL757 in apathy. We are overall encouraged by IRLABs progress lately and raise our valuation.
Fredrik Thor
The report in itself was no surprise as IRLAB continues to have a relatively stable cost base, with OPEX at SEK-37.6m, despite, in our view, a relatively significant program of activities. Most notably, the company has the ongoing Pirepemat phase IIb study, expected to be completed in Q3 2024, and preparations for the phase I trial with IRL757 (expected to be initiated this quarter). The company’s cash position amounted to SEK73m at the end of the quarter.
Recently, IRLAB announced a development agreement with MSRD/Otsuka regarding IRL757. MSRD/Otsuka has previously evaluated IRL757 and IRL942, and this agreement confirms the company’s continued interest in the compound. The development collaboration with MSRD/Otsuka will cover the development cost for the duration of the agreement. IRLAB will receive USD3m in an upfront payment and may receive up to USD5.5m in milestone payment. We are encouraged by the development as IRLAB has secured non-dilute funding to take IRL757 through clinical proof of concept/signal effect studies in apathy related to Parkinson’s and Alzheimer's.
We are overall encouraged by IRLAB's progress and think that the management execution has been strong lately, successfully navigating Mesdopetam through the end-of-phase II meeting and securing non-dilutive funding through the Formue Nord loan and IRL757 collaborations, and thus extending the cash runway through important value inflection points. Following the IRL757 deal, we have modified our assumptions and reduced the assumed capital need (to SEK80m). We raise our base case to SEK40 (35) per share.
SEKm | 2022 | 2023 | 2024e | 2025e |
Revenues | 61.3 | 5.7 | 98.7 | 276.2 |
Revenue Growth | -70.5% | -90.7% | 1636% | 180% |
EBIT | -113.1 | -180.8 | -62.6 | 131.2 |
Net Income | -113.1 | -177.9 | -62.6 | 131.2 |
Disclosures and disclaimers