THE.FORMULA Fennec Pharma: Innovation and Progress
Fennec Pharma, trading as FENC, is a dynamic company at the forefront of pharmaceutical innovation. Their dedication to advancing healthcare through groundbreaking research and development is reshaping the industry. Focused on delivering high-quality, life-changing products, Fennec Pharma is committed to improving patient outcomes and pushing the boundaries of medical science. With a strong emphasis on excellence and integrity, they are a trusted name in the pharmaceutical world.
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THE FORMULA Fennec Pharma (FENC)
PEDMARK IS AN OVERLOOKED ASSET Opaleye & venBio Select Advisor are backing investors of Fennec Fennec intends to complete Pedmark (STS) NDA by YE19 Pedmark will be the first FDA-approved treatment for hearing loss associated with platinum-based chemotherapy In light of conservative revenue estimates, Pedmark is undervalued & overlooked PT: $16
Platinum drugs are effective chemotherapeutic agents commonly used in the treatment of a variety of adult and pediatric cancers. PLATINUM- BASED CHEMOTHERAPY (PBC) INDUCES SERIOUS CONSEQUENCES IN THE YOUTH Sixty percent of children treated with cisplatin develop permanent bilateral hearing loss. Once clinically significant toxicity is observed on audiologic monitoring, current practice suggests dose reductions or omissions, potentially reducing cure,but the ototoxic damage is already done and the hearing loss is permanent. In a young child, this will have a detrimental effect on speech, language, and social development. Current treatment occurs "after the fact". Cochlear implants/hearing aids are the only option following ototoxicity associated with PBC. This option is costly ($70K-$100K)
01 02 03 04 Pedmark was tested in two phase 3 clinical trials Both trials assessed Pedmark s ability to reduce hearing loss without impacting overall survival Both trials revealed significant reductions (p<0.01) in hearing loss (48% lower risk) for the STS+PBC arm Overall survival did not differ in patients with localized disease. It did, however, favor the PBC arm in children with metastatic disease PEDMARK REDUCES HEARING LOSS ASSOCIATED WITH PBC
Based on the data, Fennec is currently processing a NDA submission, seeking FDA- approval for the prevention of ototoxicity induced by cisplatin chemotherapy in patients 1 month to < 18 years of age with localized, non- metastatic, solid tumors. Considering the mean costs of an orphan drug & cochlear implants, we can value PEDMARK therapy to be ~ $70,000-$100,000/treatment. MARKET Assuming a 40% penetration (2,000 patients) at a modest cost of $75,000/year, this grosses ~ $150M/year in peak sales. We will reduce that number by 25% to account for the grit and risks involved in marketing a product. This gives us ~ $112.5M/year. OPPORTUNITY A buyout only three times that premium leads us to $337.5M.
There are a couple of other potential competitors, but they are either years away from commercialization and/or have inferior efficacy to Pedmark Due to the orphan designation, Pedmark will have market exclusivity for a few years in the US & EU OTHER CONSIDERATIONS When approved, I believe it will be arguably unethical for oncologists to not include Pedmark in PBC in an attempt to prevent hearing loss Pedmark is a niche product that is likely to ramp-up quickly, so I do believe another company will likely acquire it
SUMMARY PBC hearing loss is a serious problem with no solution Pedmark offers significant risk reductions in PBC hearing loss without any relevant safety issues in localized diseases A $337M valuation of Pedmark values Fennec ~ $18/share To be conservative, my PT is $16/share (upon the FDA-approval of Pedmark & subsequent acquisition of Fennec)
Fennec may not, for a variety of reasons, secure FDA-approval for Pedmark Fennec may not, upon FDA-approval, be acquired for a premium SOME RISKS Pedmark, if approved, may not perform well on the market Fennec may have to dilute shareholders to continue operating
DISCLAIMERS The preceding information is abridged, purely supplemental, and should not be construed as investment advice. The intention of this presentation is to provide insight, not investment advice. While the information provided in this presentation is intended to be factual, there is no guarantee and prospective investors are encouraged to do their own fact-checking and research before investing in a company. One must also consider one's own financial standings, risk tolerance, portfolio diversification, etc. before making a decision to buy shares in a company.
