Daily Brief Health Care: Terumo Corp, Shanghai Henlius Biotech , Nanosonics Ltd, Tonix Pharmaceuticals Holding, Evaxion Biotech A/S, Oryzon Genomics, Basilea Pharmaceutica Ag and more

• A group of shareholders are looking to raise around US$1.36bn from selling ~5% stake in Terumo Corp (4543 JP).
• We have covered the background of the deal in our earlier note, Terumo Placement – US$1.4bn Secondary Selldown, Buyback Should Aid Deal Dynamics.
• In this note, we talk about the updates since and look at the performance of some of the past large Japan deals.

• Since the US$1.4 billion secondary placement announcement, Terumo Corp (4543 JP)’s shares are down 3.5% from the undisturbed price of JPY2,771 per share (29 August).
• Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Terumo’s shares have followed the pattern of previous large placements.
• The offering will likely be priced on 10 September. Despite Kokusai and Honda’s disappointing performance, the average large Japanese placement tends to generate positive returns.

• Fosun Pharma will make every effort to promote the success of this privatization. The management has disclosed the afterwards arrangements- Henlius and Fosun Pharma will further expand/integrate in the future.
• Henlius’ revenue is expected to reach RMB6 billion in 2024 and RMB8-9 billion in next 2-3 years. Even if the privatization fails, things are still manageable due to strong fundamentals.
• Fosun Pharma will not stop its capital operation against Henlius, but the plans of re-listing could be based on a new entity. So, the Cash Alternative is a better choice. 

• Nanosonics Ltd (NAN AU) reported significant turnaround, with recording H2FY24 revenue of A$90M, up 14% over the first half, driven by 20% increase in capital revenue in H2 over H1.
• For FY25, Nanosonics guided for accelerated revenue growth of 8–12%, driven by growing capital revenue with greater unit volumes and increasing recurring revenue aligned with growth in installed base.
• The company expects FY25 gross profit margin of 77–79% versus 77.9% in FY24, on higher production volumes in FY25 after reducing inventory in FY24.

• In August 2024, the World Health Organization (WHO) declared mpox a public health emergency of international concern.
• The number of cases of mpox in the Democratic Republic of Congo (DRC) has totaled more than 15,600 this year with 537 deaths.
• In the past month, over 100 laboratory confirmed cases of Clade 1b have been reported in neighboring countries of the DRC.

• EVAX is a clinical stage company that has proprietary AI models designed to more efficiently and more accurately target much-needed treatments.
• The company has two streams of possible revenue: from the treatments themselves and from the licensing of the AI technology.
• The company announced that two of its vaccine candidates had positive testing data that furthers our belief in the ability of Evaxion to bring multiple life-changing products to market.

Oryzon Genomics has announced the commencement of patient dosing in the investigator-initiated Phase Ib trial evaluating iadademstat as a combination treatment in first-line acute myeloid leukemia (AML). The study, which aims to recruit c 24 patients, is sponsored by Oregon Health & Science University (OHSU). It is designed to evaluate the safety, tolerability and optimal dose of iadademstat when administered alongside standard-of-care treatments venetoclax and azacitidine. It will also test for preliminary efficacy. Oryzon has previously generated encouraging results when investigating iadademstat in combination with azacitidine for newly diagnosed AML patients (ALICE trial) and this new study will explore potential further synergies of the broader combination.

H224 continues to be a rewarding period for Basilea Pharmaceutica, with the announcement of a third successive milestone payment for Cresemba in the last month following strong sales performance (+24% y-o-y growth in in-market sales to US$489m for the 12 months ending March 2024). The latest milestone (US$25m/CHF21m) was triggered by license partner Pfizer exceeding a predetermined sales threshold in Europe. In total, Cresemba has raked in upwards of CHF34m in milestone payments in the year to date (with c CHF32m in H224 thus far), and we expect a further c CHF5m before year-end based on the most recent guidance from management. Beyond Cresemba, we expect the key focus areas for Basilea in H224 to be finalising a US commercialisation partner for Zevtera and the initiation of the first Phase III study for fosmanogepix (in candidemia/invasive candidiasis).