Natixis : Achat, objectif 17€

NicOx Buy
Price on 29/02/2008 : €10.70 Target : €17.00 Market cap. : €504.9m
Large clinical package for Naproxcinod

EPS (€) Revision P/E (x)
2007e -0.57 0% na
2008e -0.95 0% na
2009e -0.52 0% na

The 2007 financial results for NicOx reflect the major effort made by the company to fulfil its phase III clinical trials programme for Naproxcinod. Operating costs reached €57.8m (vs €53m expected), including €46.5m of R&D costs (vs €28.6m). The operating loss is just €37.2m thanks to the €21m in revenues received in 2008 (mainly milestones on the
Pfizer and Merck agreements ). Factoring in financial result of €5.2m, the net loss comes to €32m vs €24.7m in 2006. Despite these large financial investments, net cash amounts to €173m (vs €170m estimated) at end 2007.

For 2008, the company points out that cash consumption will increase once again, in line with management desire to finish the ambitious clinical trials in phase III for Naproxcinod.
Remember that the results of 302 trial (arthritis of the knee) are expected in Q3 08, the those for the 303 trial (hip) at end 2008. NicOx also intends to undertaken statistical analysis of all the data for arterial pressure stemming from the three phase III trials , for which results should emerge in Q4 08. To pad out the clinical package, NicOx announces
the launch of new trials (111 and 112) aimed at confirming over a longer period than the 104 trial (12 and 16 weeks versus 2 weeks), the favourable impacts in terms of blood pressure for Naproxcinod vs . classic AINS. The results of these two trials are expected at
the end of 2008.

This release shows that management wants to optimise its chances with regard to the acceptance of the filing for Naproxcinod expected in mid-2009. Moreover, positive trials should allow management at NiCox to find a partner for the commercialisation of the product in the US. Analyst meeting at 11.15am today.

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