(Corrects to say the company expects revenue from royalty payments in the headline and first paragraph. Shows in second paragraph the CEO said “hopefully we’ll see potential milestones.” Rephrases second and sixth paragraph to remove words that the CEO and CFO didn’t say.)
BioLineRx Ltd. (BLRX), the Israeli drugmaker that last reported a profit in 2010, expects revenue from royalty payments to grow next year on prospects for drug approvals, according to Chief Executive Officer Kinneret Savitsky.
The company’s BL-1040 drug for heart attacks “is already in a pivotal study for the European market and we expect results in 2014 and hopefully we’ll see potential milestones, we might see revenue from the royalties based on our agreements,” Savitsky said by phone from Jerusalem. “We’re going to start our pivotal study by the end of the year,” for the BL-5010, the company’s device for treating skin lesions, she said.
Roth Capital Partners LLC raised a price estimate on the company by 67 percent yesterday, citing “multiple potential positive catalysts” including a cancer treatment that makes chemotherapy more effective. The firm estimates BioLine’s sales surge to a record $40.6 million next year.
Shares of BioLine jumped 5.3 percent to a five-month high of $2.80 after rising as much as 16 percent. The Bloomberg Israel-US Equity Index of the most-traded Israeli companies in the U.S. dropped 1.1 percent to 99.42, the second day of declines. The Israel shares this morning trimmed gains, declining 2 percent to 1.04 shekels, or $0.29, at 10:16 a.m. in Tel Aviv. The New York-traded American depositary receipts represent 10 shares of the Tel Aviv stock.
BioLine develops medical treatments and then licenses the distribution rights to larger pharmaceutical companies. It received a $30 million advance payment in 2010 for its schizophrenia drug from Cypress Bioscience Inc., which was later acquired by Royalty Pharma AG. The company has not reported revenue for the last two years as its drugs failed to reached payment-triggering milestones in trials, Chief Financial Officer Philip Serlin said in the interview.
“We had, on our latest balance sheet, we had $23.1 million of cash on our balance sheet,” Serlin said. “That cash has been budgeted for use in development. It gives us approximately cash until mid-2015. Many or most of our current catalysts are fully funded with this cash so we are in not in a position to do any kind of buyback.”
OrbiMed Advisors LLC, a private-equity firm that maintains assets in the health care industry for institutional investors, became the company’s largest shareholder in February after purchasing $8 million of new stock. In June, BioLine signed a development deal with China’s Jiangsu Chia-Tai Tianqing Pharmaceutical Co., Ltd. for a hepatitis drug that could be worth $30 million to the Israeli company.
“BL-8040 is the real deal and it is very promising,” Robert Hazlett, analyst at Roth, said by phone from New York about BioLine’s cancer drug yesterday. “Currently, Sanofi has a product called Mozobil which is similar to BL-8040 but BioLine’s drug is much more active and will likely be considered more broadly by regulators. Mozobil is successful but BL-8040 could be much bigger.” Mozobil brought in net sales of $130.3 million in 2012, Sanofi (SNY) said in its latest half-year report.
AudioCodes Ltd. (AUDC), the Israeli company whose Internet calling technology is used by Microsoft Corp., sank 4.7 percent to $6.63. Andrew Uerkwitz, analyst at Oppenheimer & Co., downgraded the stock to the equivalent of a hold from the equivalent of a buy, citing a “full valuation” in a note dated Oct. 7. Trading volume was double the daily average of the past 90 days. Israel-traded shares this morning slipped 0.7 percent to 23.89 shekels, or $6.70.
Perrigo dropped 0.8 percent to $129.18, widening its discount to Israeli shares to a two-week high. The Tel Aviv stock narrowed the gap this morning, slipping 0.7 percent to 458.40 shekels, or $129.18.
Silicom fell 3.9 percent to $35.26, the biggest slump in a month. The networking company based in Kfar-Sava, Israel traded at a $1.09 discount to Israel-traded shares, the largest gap since Aug. 15.
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