Shield Therapeutic to raise up to £25m for company-led US launch of Accrufer®

Francesca Morgan
Vox Markets
11:27, 26th February 2021

Shield Therapeutics (STX FOLLOW) has announced a proposed fundraising to raise up to £25.0 million at a price of 30p a share as well as an open offer for shareholders to raise up to £4.2 million. 

The commercial stage pharmaceutical company said the fundraising’s issue price of 30p a share represents a discount of around 43.7% to the company’s closing price on Thursday.  

Shield said it intends to use the proceeds to advance the self-commercialisation of its iron deficiency oral therapy treatment, Accrufer®, in the United States. In December 2020, the Group outlined its plans to push a Shield-led strategy to commercialise Accrufer® in the US. 

Accrufer® was approved in July 2019 by the United States FDA for the broad indication of treatment of iron deficiency in adults. Since then, the Company has conducted an extensive process in order to identify and appoint a commercialisation partner for the US market.  

Despite numerous indicative proposals from potential commercialisation partners, with some reaching late negotiation stages, the Company chose not proceed ‘due to adverse business events specific to the counterparties concerned and unrelated to Accrufer®.’ 

Shield said these discussions had demonstrated ‘that it is realistic for companies without large sales and marketing infrastructure to launch a product such as Accrufer® in the US.’   

Shield said the pandemic has also accentuated some of the advantages that Accrufer® can offer over intravenous (IV) iron replacement therapy. It said it believes the first US launch of an oral HIF inhibitor for chronic kidney disease (CKD) patients, which is anticipated for Q121, ‘is likely to increase the need for effective and well tolerated oral iron replacement therapy.’ 

Sales estimates generated by management consultants and other third parties support the potential for sales of Accrufer® in the US to exceed $100 million from the third year following launch and to reach $300 million-$400 million by years five to six, it noted. 

As stated in December 2020, Shield believes that around $30 million to $40 million (c £21 million to £29 million) should provide the finance necessary to reach the breakeven point. 

Shield’s cash flow forecasts, including Accrufer®’s US launch and the paediatric study, indicate that the Group should start to break-even on a monthly basis within 15-18 months after launch provided sales and costs are within the range anticipated by the Directors. 

The US launch costs to be covered by the fundraise includes sales representatives, ongoing market research and data analysis, marketing spend and other US operational costs.  

Despite shares having more than halved in recent months following the news that STX would not be signing a US marketing deal before the end of 2020, STX’s Directors believe today’s fundraising fulfils the necessary requirements for a Shield-led US launch of Accrufer®, a pathway they view as having the potential to generate significant returns for shareholders.  

The Company has stated that the US market opportunity for Accrufer® is ‘substantial and growing’ and in Shield's head-to-head study, Accrufer® was identified to be a credible alternative to IV therapy particularly for maintaining haemoglobin levels over the long term. 

Potential sales estimates for Accrufer® in the US are forecasted to exceed $100 million from the third year following launch and to reach $300 million-$400 million by years five to six. 

STX price chart

Reasons to Follow STX 

Shield is a de-risked, specialty pharmaceutical company focused on commercialising its lead product, Feraccru®/Accrufer®, a novel, non-salt based oral therapy for adults with iron deficiency with or without anaemia.  

Proven and Approved 

The Group’s Feraccru®/Accrufer® product has been approved for use in the United States, European Union, UK and Switzerland and has exclusive IP rights until the mid-2030s.  

Feraccru® is commercialised across the UK and European Union by Norgine B.V. and the Company is currently in the process of evaluating commercialisation options for the US market, including the potential launch of Accrufer® in the US by Shield.  

Shield also has an exclusive licence agreement with Beijing Aosaikang Pharmaceutical to develop and commercialise Feraccru®/Accrufer® in China, Hong Kong, Macau and Taiwan.  

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Disclaimer & Declaration of Interest

The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.

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