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Equity Bottom-Up

In our March 2020 report, we highlighted that Ryvu, now a pure-play biotech with a diversified R&D pipeline, is funded into 2021, which positions it well to weather the COVID-19 pandemic. Ryvu’s shares underwent a period of volatility during the initial stages of the pandemic, but are now trading at an all-time high after the corporate split in October 2019. Although the full extent of the COVID-19 impact is not yet known, Ryvu described the measures it has undertaken in its FY19 annual report in detail. Ryvu also gave a comprehensive update on its steady R&D progress across all projects. Our valuation is marginally higher at PLN1.10bn or PLN68.9/share (vs PLN67.4/share previously).

In our March 2020 report, we highlighted that Ryvu, now a pure-play biotech with a diversified R&D pipeline, is funded into 2021, which positions it well to weather the COVID-19 pandemic. Ryvu’s shares underwent a period of volatility during the initial stages of the pandemic, but are now trading at an all-time high after the corporate split in October 2019. Although the full extent of the COVID-19 impact is not yet known, Ryvu described the measures it has undertaken in its FY19 annual report in detail. Ryvu also gave a comprehensive update on its steady R&D progress across all projects. Our valuation is marginally higher at PLN1.10bn or PLN68.9/share (vs PLN67.4/share previously).

Ryvu Therapeutics - Diversified pipeline ensures continued newsflow

In March 2020, Ryvu announced its partner Menarini Group (via subsidiary Berlin-Chemie) has successfully completed the dose-escalation part (Phase I) of the ongoing Phase I/II study with SEL24/MEN1703, a dual PIM/FLT3 kinase inhibitor in a Phase I/II trial for acute myeloid leukaemia (AML). The recommended dose for the Phase II part of the study (cohort expansion) has been established. Ryvu is a pure biotech, so the ongoing turbulence in the global markets has a limited effect on the outlook of the company in our view. Moreover, Ryvu is financed until 2021, which positions it well to weather the volatility. Our valuation is unchanged at PLN1.08bn or PLN67.4/share.

In March 2020, Ryvu announced its partner Menarini Group (via subsidiary Berlin-Chemie) has successfully completed the dose-escalation part (Phase I) of the ongoing Phase I/II study with SEL24/MEN1703, a dual PIM/FLT3 kinase inhibitor in a Phase I/II trial for acute myeloid leukaemia (AML). The recommended dose for the Phase II part of the study (cohort expansion) has been established. Ryvu is a pure biotech, so the ongoing turbulence in the global markets has a limited effect on the outlook of the company in our view. Moreover, Ryvu is financed until 2021, which positions it well to weather the volatility. Our valuation is unchanged at PLN1.08bn or PLN67.4/share.


Ryvu Therapeutics - Successful Phase I with SEL24/MEN1703

Ryvu Therapeutics (formerly Selvita) is now trading as a standalone biotech after its drug discovery services business was spun out in October 2019. According to the recent Q319 report, R&D progress is on track and 2020 is shaping up to be rather eventful, including expected data readouts from the two clinical trials with lead assets SEL120 and SEL24/MEN1703. Although the trials are early in terms of clinical development (Phase Ib and Phase I/II), they both include secondary endpoints, which will evaluate anti-cancer activity of the compounds. We therefore expect the data readouts to be meaningful catalysts for the share price. Using the same approach and assumptions we developed for the former Selvita’s Innovation segment, our Ryvu valuation is PLN1.08bn or PLN67.4/share.

Ryvu Therapeutics (formerly Selvita) is now trading as a standalone biotech after its drug discovery services business was spun out in October 2019. According to the recent Q319 report, R&D progress is on track and 2020 is shaping up to be rather eventful, including expected data readouts from the two clinical trials with lead assets SEL120 and SEL24/MEN1703. Although the trials are early in terms of clinical development (Phase Ib and Phase I/II), they both include secondary endpoints, which will evaluate anti-cancer activity of the compounds. We therefore expect the data readouts to be meaningful catalysts for the share price. Using the same approach and assumptions we developed for the former Selvita’s Innovation segment, our Ryvu valuation is PLN1.08bn or PLN67.4/share.

Ryvu Therapeutics - First ever clinical data from lead assets in 2020

The corporate split is now complete and Selvita is continuing as Ryvu Therapeutics, which will focus on innovative drug development. The contract research organisation (CRO) business, which was spun out, has retained the Selvita brand and is also trading on the Warsaw Stock Exchange. Pawel Przewiezlikowski, co-founder and CEO of the former Selvita, continues to lead Ryvu Therapeutics, while Boguslaw Sieczkowski, co-founder and COO is now the CEO of the newly listed Selvita (CRO). We performed a detailed analysis of Ryvu Therapeutics assets in previous notes. Our last published SOTP valuation of the former Selvita implies a valuation for Ryvu of PLN935m or PLN58.6/share, which we will update with the Q3 results on 6 November 2019.

The corporate split is now complete and Selvita is continuing as Ryvu Therapeutics, which will focus on innovative drug development. The contract research organisation (CRO) business, which was spun out, has retained the Selvita brand and is also trading on the Warsaw Stock Exchange. Pawel Przewiezlikowski, co-founder and CEO of the former Selvita, continues to lead Ryvu Therapeutics, while Boguslaw Sieczkowski, co-founder and COO is now the CEO of the newly listed Selvita (CRO). We performed a detailed analysis of Ryvu Therapeutics assets in previous notes. Our last published SOTP valuation of the former Selvita implies a valuation for Ryvu of PLN935m or PLN58.6/share, which we will update with the Q3 results on 6 November 2019.

Ryvu Therapeutics - Introducing Ryvu Therapeutics

Over the past several months Selvita has been executing on its new R&D-focused multi-year strategy funded by the share issue in March 2018 raising PLN134m and other sources. While sales continue to grow at an impressive rate in the Services business (up 53% in Q118), R&D progress across the pipeline has been reported in several publications in recent months. Our Selvita valuation is PLN1.30bn or PLN81.2/share versus PLN81.7/share previously.

Over the past several months Selvita has been executing on its new R&D-focused multi-year strategy funded by the share issue in March 2018 raising PLN134m and other sources. While sales continue to grow at an impressive rate in the Services business (up 53% in Q118), R&D progress across the pipeline has been reported in several publications in recent months. Our Selvita valuation is PLN1.30bn or PLN81.2/share versus PLN81.7/share previously.

Selvita - Progress across pipeline; Services sales up 53%

Poland

Selvita Spolka Akcyjna operates as a pharmaceutical company. The Company discovers drugs, as well as provides research and development services. Selvita serves customers worldwide.

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