Xbrane SEK 238m Capital Raise | Q2 2019

The Board of Directors in Xbrane Biopharma AB (publ) (“Xbrane” or the “Company”) has today, resolved on a capital raise up to approximately SEK 238 million. The capital raise is made through a share issue without preferential rights for the Company’s existing shareholders up to approximately SEK 147 million (the “Directed Share Issue”) and a 94 percent guaranteed new share issue with preferential rights for the Company’s existing shareholders up to approximately SEK 91 million (the “Rights Issue”).

Comments from CEO

“We are pleased to welcome STADA and Swedish and international institutional investors to Xbrane. This strengthens the company significantly! With these share issues, our phase III study with Xlucane is fully financed. STADA’s investment in Xbrane is a powerful sign of a strong belief in Xlucane’s commercial potential. It is very gratifying to lead Xbrane through this phase III trial and continue to work with our portfolio of attractive biosimilars. With this capital raise the Company further targets to move to Nasdaq main market during 2019.”, says Martin Åmark, CEO Xbrane Biopharma.

Background and reasons

In July 2018, Xbrane entered into a cooperation agreement with STADA Arzneimittel AG (“STADA”) regarding development, marketing and sale of Xbrane’s primary biosimilar Xlucane (ranibizumab (Lucentis®) biosimilar). STADA is a well-established global pharmaceutical company focused on biosimilars and generica. STADA currenly sells pharmaceutical products in over 130 countries. The agreement entail that the companies share equally on all upcoming development costs and profits that is generated from sales of Xlucane. Xbrane will be responsible for the development of the product until market approval, whilst STADA will be responsible for the sales and marketing of the product. Xlucane is, as far as the Comapny is aware, the only biosimilar for Lucentis® with a commercialization partner in place and in a registration-based clinical phase III trial with the aim for market approval in Europe and the US.

Xbrane and STADA initiated in April 2019 the pivotal phase III trial with Xlucane. The target is to, well in advance of patent expiration of the originator product in 2022 (Europe) obtain marketing authorization. Xbrane shall pay half of the costs for the trial, which is estimated to approximately MSEK 300-350.
The market for biosimilars is relatively young, the first biosimilar was approved in Europe 2006 and in the US 2015 and the market is estimated to grow with approximately 30 percent per year up until 2022.[7] The market for biosimilars is mainly driven by loss of exclusivity on biological pharmaceuticals that enable launch of new biosimilars, increased acceptance from doctors and patients as well as pressure from public and private payers of pharmaceuticals to use the most cost effecient alternatives.

Together with marketing and sales expertise from STADA, the Board of Directors believes that the Company has good prospects of achieving the desired sales potential of Xlucane. this background, the Share issues will fully finance the ongoing phase III trial for Xlucane.