Dimerix (ASX:DXB) has added incremental value through its licensing deal with Everest Medicines while strengthening its funding position and validating DMX-200's commercial potential, Euroz Hartleys said in a note on Tuesday.
The company has entered into an exclusive licensing agreement with Everest Medicines to commercialize DMX-200 for focal segmental glomerulosclerosis (FSGS) across Greater China, South Korea and Southeast Asia.
The company will receive AU$14.1 million upfront, up to AU$467 million in development and sales milestone payments, and tiered royalties of 10% to 15% on net sales, while Everest Medicines will fund regulatory, sales and marketing activities in the region.
Euroz Hartleys said the agreement creates significant value from a region that was not factored into its forecasts, representing entirely incremental upside.
The firm added that the deal further validates DMX-200, with the company now securing five partners committing up to AU$1.9 billion in upfront and milestone payments, including more than AU$80 million in non-refundable cash.
The firm estimates the total addressable market for DMX-200 in FSGS in China at AU$3 billion, bringing the combined opportunity across all licensed territories to around AU$9.5 billion.
The firm noted that the company would have pro-forma cash of AU$40.7 million post-upfront, with talks for up to $50 million in non-dilutive funding potentially lifting total available capital to over AU$110 million to fund its phase three program.
The investment firm retained its speculative buy rating on Dimerix and raised its price target to AU$2.05 from AU$1.35.
Dimerix's shares were down almost 3% in recent Wednesday trade.
Comments