Shield Therapeutics (STX): Beefing up for the U...

Edison Investment Research Limited Edison Investment Research Limited: Shield Therapeutics (STX): Beefing up for the US opportunity 02-Feb-2021 / 08:00 GMT/BST London, UK, 2 February 2021 Shield Therapeutics (STX): Beefing up for the US opportunity Shield Therapeutics' (STX's) shares fell sharply in December 2020 on the announcement that a US partnering deal would not be completed in 2020 and that the company is considering launching Accrufer itself in the US. We believe the market reaction has been overdone and the current share price fully discounts any value from the US and China opportunities. Until STX provides further clarity, we have continued to evaluate it based on a US partnering deal. Our modelling suggests an STX-led US launch could more than double longer-term shareholder value, but this is accompanied by increased near-term financial and investment risk, as STX will need to raise funds to establish a small but focused US marketing organisation. We value STX at £298.5m. Our revised valuation is £298.5m or 254p/share, vs £379.1m or 324p/share previously. This reflects a US partnering deal but with more cautious assumptions; we delay launch to 2022 and reduce the upfront payment to £10m. We have also lowered EU sales trajectory in 2021/22 reflecting the need for further launches. We include unaudited net cash at 31 December 2020 of £2.9m, which gives a cash runway to Q221 and could be extended until end 2021 through two loan facilities agreements totalling c £4.4m. Our NPV calculation is based on Feraccru/Accrufer achieving peak sales of €130m in Europe, $410m in the US and $126m in China, through partners.    Click here to view the full report. All reports published by Edison are available to download free of charge from its website www.edisongroup.com About Edison: Edison is a leading research and investor relations consultancy, connecting listed companies to the widest pool of global investors. By focusing on the volume and quality of investors reached - across institutions, family offices, wealth managers and retail investors - Edison can create and gauge intent to purchase, even in the darkest pools of capital, and then make introductions via non-deal roadshows, events or virtual meetings. Having been the first in market 17 years ago, Edison now has more than 100 analysts covering every economic sector. Headquartered in London, Edison also has offices in New York, Frankfurt, Amsterdam and Tel Aviv and a presence in Athens, Johannesburg and Sydney. Edison is authorised and regulated by the Financial Conduct Authority. Edison is not an adviser or broker-dealer and does not provide investment advice. Edison's reports are not solicitations to buy or sell any securities. For more information please contact Edison: Susie Jana   [phone] Dr John Priestner [phone] [e-mail] Learn more at www.edisongroup.com and connect with Edison on:  LinkedIn  https://www.linkedin.com/company/edison-group-/ Twitter   www.twitter.com/Edison_Inv_Res YouTube  www.youtube.com/edisonitv Dissemination of a CORPORATE NEWS, transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.

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1164752 02-Feb-2021