In today’s briefing:
- Korea Small Cap Gem #42: T&L Co
- Innogen (银诺医药) IPO: Fairly Valued at Best and Lack of Institutional Interests
- Metsera Inc (MTSR) Six Month Summary: The Bright Spot in a Quiet Biotech Year
- Carna Biosciences (4572 JP): 1H FY12/25 flash update
- Heartflow IPO: Mounting Losses, ~99% Revenue Concentration From a Single Product
- Shofu Inc (7979 JP): Q1 FY03/26 Flash update
- LNTH: Competition Escalates in PSMA Imaging
- Eisai Co Ltd (4523 JP): Impressive 1Q Result; Subcutaneous Leqembi Is Key for Future Growth
- NetraMark Is Expanding Its Capabilities
- QNRX: Recent FDA & EMA Designations for QRX003 Potentially Could Accelerate Timeline
Korea Small Cap Gem #42: T&L Co
- T&L’s key investment highlights include its exceptional sales growth led by its core wound dressing/cosmetic product Mighty Patch.
- It had a CAGR sales growth of 44% from 2020 to 2024. Its operating profit increased at even faster rate (CAGR of 56% from 2020 to 2024.
- Considering T&L’s 40%+ per year sales growth and 50%+ per year operating profit growth from 2020 to 2024 combined with 30%+ ROE, the company is deeply undervalued.
Innogen (银诺医药) IPO: Fairly Valued at Best and Lack of Institutional Interests
- Innogen, a China-based near-commercial stage biotech company, launched its IPO to raise at least USD 88 million via a Hong Kong listing.
- In our previous note, we have examined the company’s core product, namely efsubaglutide alfa, updates in various filings, and our thoughts on valuation.
- In this note, we look at the deal term. We think the valuation is demanding and lacks institutional interest.
Metsera Inc (MTSR) Six Month Summary: The Bright Spot in a Quiet Biotech Year
- The company priced a downsized 15.3 million share offering at $18.00, notably above its initial $15–$17 range in late January.
- After the biotech sector took a hit in April, Metsera shares rallied back to a high of $47.40 in mid-July, nearly tripling off the lows.
- Metsera’s trajectory will be determined by data. With two clinical trials underway and expectations rising, the year-end readout for MET-233i could meaningfully shift the valuation—up or down.
Carna Biosciences (4572 JP): 1H FY12/25 flash update
- The company reported a sales decline of 20.4% YoY to JPY251mn, with an operating loss of JPY1.1bn.
- R&D spending increased by 9.2% YoY to JPY2.1bn, focusing on clinical trials for kinase inhibitors.
- The company raised JPY675mn through unsecured convertible bonds to fund R&D expenses for FY12/25.
Heartflow IPO: Mounting Losses, ~99% Revenue Concentration From a Single Product
- Heartflow Inc., a commercial-stage medical technology company that has pioneered the use of software and AI for diagnosing and managing CAD, is expected to IPO this week.
- Heartflow is marketing the sale of ~16.7M shares at $17-$18 per share in upsized initial public offering in the United States.
- I believe current IPO valuation range appears to capture much of the near- to mid-term upside potential. Moreover, I’m concerned about the lack of profitability and mounting losses.
Shofu Inc (7979 JP): Q1 FY03/26 Flash update
- Q1 FY03/26 revenue was JPY9.5bn (+0.5% YoY), with domestic revenue up 6.2% and overseas down 3.2%.
- Operating profit decreased 3.5% YoY to JPY1.5bn, while net income fell 23.8% YoY to JPY854mn.
- Dental business revenue rose 1.2% YoY; Nail Care revenue declined 9.3% YoY with a JPY42mn operating loss.
LNTH: Competition Escalates in PSMA Imaging
- Lantheus is a leader in radiopharmaceutical offerings in oncology & precision diagnostics.
- It offers a portfolio of diagnostic & therapeutic products directly & via partnerships & licensing.
- The primary revenue driver is Pylarify, a PET tracer for PSMA-expressing prostate cancer.
Eisai Co Ltd (4523 JP): Impressive 1Q Result; Subcutaneous Leqembi Is Key for Future Growth
- During Q1FY26, Eisai Co Ltd (4523 JP) reported 55% YoY increase in operating profit to ¥21B, on just 7% YoY growth in revenue to ¥203B. The company reiterated FY guidance.
- During Q1FY26, Leqembi revenue increased 269% YoY and 57% QoQ to ¥23B, driven by growth across all the regions. Eisai has guided for FY26 Leqembi revenue of ¥77B (+73% YoY).
- The U.S. approval of Leqembi SC-AI maintenance dosing and the drug’s European launch are the key near-term triggers.
NetraMark Is Expanding Its Capabilities
- NetraMark is expanding its capabilities, recently forming a collaboration with Pentara to launch an AI tool to provide insight into participating trial sites that deviate from the overall mean.
- This can potentially improve aspects of the trial design, including pre-trial site selection and trial site reporting, among others.
- The company expects this tool can help accelerate its growth over time.
QNRX: Recent FDA & EMA Designations for QRX003 Potentially Could Accelerate Timeline
- The FDA recently granted QRX003 Rare Pediatric Disease (RPD) Designation for the treatment of NS.
- The European Medicines Agency earlier had granted Orphan Drug Designation to QRX003.
- The company believes these designations reinforce the potential of QRX003 as a therapeutic candidate as it advances clinical studies towards a potential New Drug Application (NDA) for QRX003 as the first approved treatment for NS.
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