Biovica is one of the most interesting companies in Scandinavian pharma sector. It has the first ever FDA approved biomarker test for breast cancer. According to Bloomberg (link in SA), Biomarker testing will change the way cancer is treated. Biovica should be one of the main beneficiaries. Pareto estimates Biovica sales to exceed USD100 million in six years.
Biovica Investment Thesis From SeekingAlpha:
The Notes of the call with the Biovica management
We had a call with Biovica management last week. The notes from the call are bellow
Summary
- “We are doing great in all business areas. We will deliver on all targets in USA – the hospitals and Medicare”.
- In Europe, we are negotiating with partners to take new territories.
- Pharma collaborations – in a year or two, this should be a major business line for us. Not reflected in analyst’s forecasts.
- We’re constantly looking into the best possible financing option. As the landscape has changed significantly the last 2 years, we’re looking broader than just equity financing.
Medicare Announcement – what does it mean
On Friday 21/7 Biovica announced it received a PLA code from Medicare:
- It is a Major milestone for Biovica – Medicare is the largest insurer in the US with around half patients being covered by it.
- Rubber stamp on Biovica’s DiviTum® TKa test for other US based insurers
- Strongest price reference for other US based payers
- Faster reimbursement of DiviTum® TKa test for Medicare beneficiaries (50% of all breast cancer patients.
- Major sales driver in the coming quarters, together with commercial agreements.
US Hospitals
- We’re on track with getting agreements with hospitals in US in order for them to start using DiviTum TKa.
- Some of them are networks consisting of several hospitals.
- In the coming months we should be able to announce the first agreement, and by the end of our fiscal year (April 2024) we should be able to announce perhaps 10 hospital contracts.
Price of DiviTum® TKa test
- Average sales price of $400 per test seems to be a reasonable assumption. Agreements so far supports this conclusion.
Q2 Revenues
- We are selling, but still not in big volumes as we’re focusing on getting commercial agreements in place that will more quickly take us to greater volumes of sales.
Europe
- Territories that we have agreements with:
- Launch activities are ongoing, such as Italy, Netherlands and Poland
- Training sessions with local sales staff
- Communications and event with KOL and oncologists
- Setting up logistics, e.g. lab facility and sample shipmen
- Work ongoing to expand into new territories, focus on Europe’s largest markets (Germany, Spain, UK, etc)
- Factors important when selecting market and partner:
- Market: Price level, time to market
- Partner: Need to have required abilities such as sales force oncology, testing facility, market access capability, etc
- You can expect additional announcements before end of FY23/24 (ends 30/4-24)
- For each market: start with out of pocket market, in parallel you work in order to get reimbursement coverage
Other breast cancer tests
- We are focusing our resources on metastatic breast cancer.
- As previously communicated, we have data outside MBC and oncologists are using it wider than the intended use we’ve got from the FDA.
Pharma Collaborations and Companion Diagnostics (CDx) for Specific Drugs
- There is enormous potential in being able to sell the assay as a companion diagnostic to one of the cancer drugs that is currently under development.
- We are currently in 17 projects with different pharma companies in different stages. This projects have the potential to be developed into a joint development project for a new CDx product.
- Process: Biovica gets funding from pharma to develop a new test for specific therapy. The test and the therapy would be sold as a combined product, i.e. CDx.
- CDx should be a major business line for Biovica in the coming years.
See the blog for other posts on Biovica
Biovica latest presentation:
https://biovica.com/investor-relations/financial-reports/#english
Disclosure:
The goal of the blog is to provide investment ideas for further research. I/we have a beneficial position in the shares discussed above either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. The article does not represent investment advice. Please do your own research before making any investment action.
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